Oral Answers to Questions

EDUCATION AND SKILLS

The Secretary of State was asked—

Enterprise Education

Bob Blizzard: What plans he has to develop enterprise education.

Kim Howells: It is vital that we encourage young people to become more enterprising and to consider the possibility that with the right dedication and skills they could set up their own businesses. That is why, in September 2005, we will provide £60 million for enterprise education for all key stage 4 pupils. To help schools deliver that new entitlement, we have spent over £30 million on 195 Pathfinder projects involving more than 700 schools and funded an enterprise adviser service to help to prepare schools, especially in poorer areas, for that entitlement.

Bob Blizzard: Will my hon. Friend join me in congratulating Lowestoft schools on winning the Enterprising Britain competition for the eastern region, and Hazel Johnson in particular on her dynamic leadership? With four enterprise advisers from his Department's Pathfinder project and another provided by Shell, enterprise education is inspiring young people in Lowestoft and bringing schools and business together, which we need if we are to regenerate the town. The funding, however, finishes this year, so will he study that success and maintain the funding by supporting the current schools bid to set up a community interest company in conjunction with another local company, Adnams?

Kim Howells: I certainly join my hon. Friend in praising the work in Lowestoft, especially by Hazel Johnson. It has been a great achievement, and I am only too glad to look at the proposals from the town.

Nick Gibb: One of the key components of enterprise education is a grasp of basic mathematics. Was it because the maths results in English schools in the programme for international student assessment 2003 were so poor that the Government were happy to accept the decision by the Organisation for Economic Co-operation and Development to exclude the figures for England from the international comparisons, even though the participation rate of 64 per cent. was higher than the 56 per cent. participation rate for the USA, whose figures were included, and the 61 per cent. participation rate in PISA 2000, the figures for which were accepted by the OECD?

Kim Howells: As I understand it, the OECD has been complimentary about the fact that primary schools in this country have the best ever mathematics results, and we should celebrate that. The hon. Gentleman is right that we still have a long way to go, but we are making genuine progress.

Linda Perham: Does my hon. Friend accept the role of business education partnerships in promoting enterprise in schools? In my area, the Redbridge business education partnership does excellent work, and I have been pleased to support it over the years.

Kim Howells: I am very much aware of the good work that my hon. Friend has done in and around Redbridge, and I am happy to endorse her point about business education partnerships, which are the way forward. Our hon. Friend the Member for Waveney (Mr. Blizzard) mentioned the involvement of Shell in Lowestoft, and the company is to be congratulated on showing the way forward. If we can inspire more young people through business education partnerships to consider setting up their own businesses, that will go a long way towards transforming the economy.

School Transport (Leicestershire)

David Taylor: What recent representations he has received regarding the provision of school buses in Leicestershire.

Stephen Twigg: In addition to the valuable points made by my hon. Friend on Second Reading of the School Transport Bill, since August this year the Department has received one piece of correspondence on this issue.

David Taylor: Regular readers of the Leicester Mercury will know that our county has its share of overcrowding, antisocial behaviour and vandalism on school buses. Will the Minister ensure that the School Transport Bill, which was introduced in the House last week, includes measures to ensure that student journeys are free of danger, free of loutishness, free of damage and, most importantly, free of charge?

Stephen Twigg: I am not sure whether I can reassure my hon. Friend on his last point, but he is right to emphasise the importance of promoting positive behaviour on the school journey. We have said in the prospectus accompanying the Bill that the promotion of such behaviour is a necessary condition of any scheme by a pilot authority. More broadly, the promotion of positive behaviour on the school run is at the heart of the work that we are doing with our colleagues in the Department for Transport on travelling to school.

Mark Hoban: Will not the people of Leicestershire be angry that school buses that are currently free could cost parents £200 per child under the School Transport Bill? Will not they see that as another third-term tax rise aimed at filling the Chancellor's black hole?

Stephen Twigg: I am sorry that in the Chamber the hon. Gentleman is not following the constructive path that he followed in Committee when we considered the School Transport Bill, which will return to the House soon. As he knows, one in 10 children currently benefit from free school transport. The purpose of the Bill is to enable local communities, if they want to, to try new ways of providing school transport to more children. I believe we should be worried about the many, not the few. Once again, the hon. Gentleman is concerned only with the few, not the many.

Teachers (Malicious Allegations)

Tony Cunningham: What steps he is taking to protect teachers from malicious allegations made against them by pupils.

David Miliband: In November my right hon. Friend the Secretary of State launched a consultation on a new process for dealing with allegations against teachers and school staff. The consultation covers the reduction of time scales, new procedures to improve the management of cases and, significantly, advice by the Association of Chief Police Officers that anyone under investigation should not be named until they are charged with an offence.

Tony Cunningham: I am sure my hon. Friend would agree that there should be zero tolerance of abuse in the classroom. Equally, there must be zero tolerance of malicious complaints against teachers. Will my hon. Friend assure the House that complaints will be dealt with speedily, and that firm action will be taken against those who make malicious complaints?

David Miliband: As a former teacher, my hon. Friend speaks with real knowledge of the matter. He is right that the trauma of abuse of trust and of unfounded allegations need to be tackled. I am pleased that about 70 pr cent. of all cases are currently dealt with within three months, but we want to raise that figure to 95 per cent. because speed is of the essence. I remind the House that the sanctions on false and malicious allegations are extremely serious, including charges of perjury and perverting the course of justice.

Patrick Cormack: Does the Minister agree that the most important consideration is to preserve the anonymity of those charged? He referred to that in his answer. Will he assure the House that from now onwards, any teacher who is charged will have his or her anonymity preserved until we know that that man or woman is guilty?

David Miliband: It is certainly our view that teachers should have their anonymity preserved until they are charged, if they are charged. I should point out that very few are charged; about 17 per cent. of all cases end in a prosecution. I am pleased that ACPO has issued new guidance to preserve anonymity. There is also the responsibility of the press in the matter. The Press Complaints Commission guidance is very clear about what those responsibilities are, and I would expect the press to follow that guidance.

Chris Bryant: The Minister will know that it is not only in formal education that the poison of malicious allegations has been a terrible problem in recent years; it also occurs in informal education through the youth service. Will he ensure that the processes affecting teachers that he hopes to introduce in the next couple of years will also apply in the youth service?

David Miliband: My hon. Friend raises a good point. When we speak of unfounded allegations and of anonymity, simply to speak of teachers is not sufficient, given the range of professionals who work with young people. The safeguards that we want for children and for staff should apply to all those who work with young people in and out of schools.

Martin Smyth: Significantly, in Portcullis House there is a conference dealing with false allegations of abuse and what has happened in the courts over the years. We welcome the improvements and the commitment from police officers, but will the Minister consult his colleagues throughout Government so that legislation might be brought in to safeguard children and teachers? It is important that in the youth service at large, those who devote themselves to teaching can be protected, as well as those whom they teach.

David Miliband: The House knows that the hon. Gentleman has a long and distinguished record in campaigning on these issues and bringing attention to them. I am happy to say that there is proper consultation right across the United Kingdom on the issue. It is important, as my right hon. Friend the Secretary of State has pointed out, that the Bichard inquiry referred to matters in this area, and we will respond to that shortly. I hope we will help to provide some of the reassurance that the hon. Gentleman seeks.

Tim Collins: What the Minister said about speeding up trials is welcome, and his remarks about the importance of preserving anonymity will also be welcomed by many teacher unions and their representatives. But he knows that they want more than simple guidance from ACPO and exhortations to the media from the Minister, so why will he not act on what the teacher unions have specifically requested: legislation to guarantee anonymity in those circumstances?

David Miliband: The teacher unions have actually said that they want to see how the new ACPO guidance works, because this is an area where there are difficult issues. My hon. Friend the Member for Rhondda (Chris Bryant) referred to adults who do not have teaching status but work with young people none the less. We want to ensure that the guidance works, and I hope that we can count on the hon. Gentleman's support in ensuring that it does.

Tim Collins: The Minister will know that we of course hope that guidance works, but he will also know that many teachers have been in extraordinary distress because their details have been published in the local media, placed there either by people in schools or by the police. He will know that a head teacher committed suicide this year in the Isle of Wight because his details were released in that way.
	May I press the Minister again to say why he will not legislate? My party is committed to support legislation on this matter. We will support any legislation that this Government introduce. If they continue to refuse to introduce that legislation, we will introduce it in a teacher protection Bill in the first Queen's Speech of the next Conservative Government.

David Miliband: It is very sad that the hon. Gentleman has sought to make a party political issue of this matter, but I cannot let it pass. His right hon. Friend the Member for Wokingham (Mr. Redwood) said that, under a Conservative Government:
	"In the first hour, ministers will explain to officials that we are not in the business of passing 4,000 new laws a year."
	I urge the hon. Gentleman to look at what his right hon. Friend is saying. This area requires careful application of the law and due diligence in every case. I think that the trauma both of abuse of trust and of abuse of teachers needs to be dealt with in a serious way by this House, and not in a posturing way.

Employer Training Pilots

Si�n Simon: What assessment he has made of the national employer training pilots.

Ivan Lewis: An evaluation of the initial six pilots published in November 2003 showed a high level of employer satisfaction with particular value being placed on the flexible and responsive delivery of training in the workplace.

Si�n Simon: I thank the Minister for that answer, and I invite him to join me in commending the Birmingham and Solihull employer training pilot, one of the six initial pilots and, I think, one of the most successful; thousands of people employed by hundreds of employers were trained. Training for small businesses in particular can be a problem and a drain, and it is really difficult. What else will the Government continue to do to help?

Ivan Lewis: I congratulate my hon. Friend on his support for the pilots in the Birmingham and Solihull area, which are among the best in the country, as he would expect me to say at the Dispatch Box. The pilots are demonstrating a number of elements in terms of attracting employers and small and medium-sized enterprises in particular to invest in training. We are reaching employers who would have been reluctant to train in the past and getting to employees who lack basic skills or level 2 qualifications and who would not feel able in ordinary circumstances to go back to education. We are removing the bureaucracy and complexity of accessing training, particularly for small businesses. We are also bringing employers and trade unions together at the workplace to improve employment relations. We see that approach to encouraging employers to invest in the training of their work forces as central to a future demand-led training system.

Phil Willis: We are generally supportive of the pilots and work-based training, but there is huge confusion among employers and in the further education sector about the future. Now that the windfall levy, which paid for most of the initial work, has gone, will the Minister confirm that future funding will come out of Learning and Skills Council adult budgets? What proportion of the learning and skills budget will be devoted to the national employer training programme, and what effect will that have on FE budgets? Finally, on the point made by the hon. Member for Birmingham, Erdington (Mr. Simon), what compensation package has the Minister agreed with the Chancellor to support small employers in particular in releasing people for training?

Ivan Lewis: First, I think that the hon. Gentleman's party opposed the windfall levy, and we would not have had the employer training pilots if that policy had been followed. I thank him, however, for his genuine support of the principles underpinning the employer training pilots. On his substantive points, there are two issues. First, it has always been part of our vision that we need to re-engineer some of the existing money that we spend on training through the Learning and Skills Council, and move that money from the classroom to the workplace. As for the implications for colleges of further education, what we are seeing in the pilots is that many entrepreneurial colleges are now doing outreach work, going into workplaces, engaging with employers and providing the training in a customised, tailor-made way that meets the needs of the employer and the employee. I believe that further education has nothing to fear from the employer training programme. As for the final part of my answer, the hon. Gentleman will have to wait with bated breath for the statement on the pre-Budget report, which I think is about an hour away.

Bill Olner: I urge the Minister to go further, and implore him to ensure that there is plenty of training in schools. Sometimes young people miss a golden opportunity because they come to training late. I urge him to ensure that people go into not only further education colleges, but the classroom, so that we can get the right people in the skilled work force of the future.

Ivan Lewis: I agree entirely with my hon. Friend. All these policies bring the worlds of work and school closer together: specialist status for secondary schools; the new vocational pathways that we are developing; the flexible partnerships by which young people spend two days a week at school, two days a week at college and a day with local employers; enterprise education, which has become a mainstream part of the curriculum; and the new 14 to 16 young apprenticeship. In the future, we want a dynamic, day-by-day relationship that ensures that the choices that young people make about their curriculum are linked to the labour market and are based on authentic, real life contact with the world of work.

Sure Start

Linda Gilroy: What assessment she has made of the effects of Sure Start programmes on speech and language development.

Margaret Hodge: The initial findings from the national evaluation of Sure Start's effect on children's speech and language development will be available in summer 2005. We know from individual Sure Start local programmes that the early support is having a positive impact. In one of the Stockport Sure Starts, for example, the number of children in reception classes with identified speech and language needs fell in successive years from 31 per cent. to 14 per cent. to 11 per cent. We also know from the comprehensive survey of more than 3,000 children published last week that two years of high-quality pre-school education boosts children's results at key stage 1 by four to six months.

Linda Gilroy: I thank my right hon. Friend for that response and for her work to ensure that children in the Keystone Sure Start in my constituency get a better start in life. What is she doing to ensure that children in other disadvantaged areas get such a good start and to mainstream the lessons learned from the Sure Start programmes?

Margaret Hodge: We are committed to mainstreaming all those Sure Start policies and programmes right across the country in every community. That is precisely why we have announced that we will develop 2,500 Sure Start children's centres by 2008. My hon. Friend must wait until after the pre-Budget report to see what further progress we can make in providing that revolution in children's services.

Barry Sheerman: My right hon. Friend knows that the Education and Skills Committee has taken evidence showing what a good investment early years intervention is. Will she examine the evidence that we received from the Social Market Foundation on Monday this week, which suggests that some Sure Start programmes are much more effective than others? Will she examine that evidence and make sure that good practice is spread as rapidly as possible, because the money should be spent wisely and effectively?

Margaret Hodge: My hon. Friend makes a good point. In the early days of evolving the Sure Start programmes, we enabled local Sure Start programmes to develop at their own pace and with their own priorities. We are now learning what works. As we develop Sure Start children's centres across the country, we will build on best practice to ensure that every family and every child in every community benefits from the Labour Government's investment in early years.

International Development

Sally Keeble: What steps he is taking to promote the understanding of international development in schools.

Charles Clarke: On 15 November this year, I launched the Department for Education and Skills international strategy, called Putting the world in world-class education. It makes clear my Department's aim to ensure a strong international dimension across our education system, which we intend to achieve by building on the good work already being done in many schools by the British Council, the Department for International Development and voluntary organisations. We have also developed the Global Gateway, which is a new international website to allow schools across the world to engage in creative partnerships and develop mutual understanding.

Sally Keeble: I am grateful to my right hon. Friend for that answer. Will he join me in congratulating the 25 schools in my constituency that have been studying the plight of HIV/AIDS orphans in Kenya and preparing Christmas parcels of toys and school equipment for them? Will he join me in paying tribute to Kappa Packaging, the local firm that made the boxes, and to DHL, which is flying all 1,800 of them to Kenya? Does he agree that such work done by schools and backed by businesses is the way to build the kind of understanding that we need in future to tackle international problems?

Charles Clarke: I very strongly commend the schools and organisations supporting the Kenya project in my hon. Friend's constituency. She has described that work to me, and it is genuinely impressive and exciting. Such work with Kenya fits absolutely with the Commission for Africa and the Government's focus, through our G8 presidency, on promoting Africa and how we can work together in so many ways. Education is the key to contesting HIV/AIDS in sub-Saharan Africa, and the kind of work in Northampton that my hon. Friend can happily represent is inspirational.

Nigel Evans: In my estimation, young people really are interested in international development and want to study it; many do so in their own private time with youth groups, church groups and various other organisations. I therefore encourage as much as possible the wider accessibility of learning about international development. I ask the Secretary of State look for ways further to assist young people in their gap years after school to enable them to go abroad to give assistance in the third and developing worlds, as Prince Harry did in Lesotho although clearly many of our young people do not have access to the resources that he has. Will the Secretary of State ensure that young people who want to go abroad are not prevented from doing so merely by lack of resources?

Charles Clarke: The hon. Gentleman is entirely correct, and we are considering volunteering in the gap year in the way that he described. The Russell commission, in particular, is examining it and will make recommendations. The hon. Gentleman's pointI am delighted that it has all-party supportis fundamentally true. Young people know that they are growing up in an international, global world; they understand our interdependence and want to contribute to solving the problems of the world.

David Drew: Will my right hon. Friend commend Ross Workman, the head of Nailsworth school in my constituency, who has established very close links with Uganda? Does my right hon. Friend agree that we should permit teachers, particularly head teachers, to go out and see different parts of the world, especially Africa, ensure that funding is in place and bring back teachers from those countries so that they can share in the developed world's education system and learn from what we do here?

Charles Clarke: My hon. Friend is correct. I strongly commend the schools in his constituency that are doing this work. I have seen outstanding examples of such work, which is facilitated by the Global Gateway. I had a video conference with a school in Lagos, Nigeria that is working with a school in east London. It is exhilarating to see how people can begin to understand issues in this way and I commend it most strongly.

Judy Mallaber: A few months ago I had a wonderful series of visits to primary schools to discuss the international campaign on the 100 million children around the world who do not go to school. In view of the statement by the Department for International Development that educating girls is the single most effective measure in tackling international poverty, will my right hon. Friend take the opportunity of that Department's forthcoming document on the subject to raise it more often in schools to promote greater understanding among our schoolchildren and to gain still further support for the international campaign on the efforts to educate girls around the world?

Charles Clarke: My hon. Friend is absolutely right. Yes, we will take that opportunity. We are working very closely with the Department for International Development. Incidentally, through campaigns such as Comic Relief, with its focus on the G8 presidency this year and the importance of Africa, we have already had initial discussions about how we can develop this and take it forward in a much stronger way. Returning to the comments of the hon. Member for Ribble Valley (Mr. Evans), the fact is that there is a desire among young people in schools and colleges to get involved in this matter, and we have to enlist that.

Sex Education

Nicholas Winterton: What guidance he has issued to schools on the teaching of sexual health and the prevention of sexually transmitted infections.

Stephen Twigg: Our sex and relationship guidance issued to all schools in July 2000 requires schools to teach about sexual health and sexually transmitted infections. Teaching strategies should include helping pupils clarify their knowledge of sexually transmitted infections.

Nicholas Winterton: With one in eight young women in this country infected with chlamydia, and with a huge increase in the incidence of syphilis and gonorrhoea, will the Government carefully consider the example of the Ugandan Government, who have promoted the ABC campaign to highlight abstinence and faithfulness in sexual relationships? That campaign has resulted in a 75 per cent. reduction especially in HIV infection among 15 to 19-year-olds. Cannot we learn something from a developing country in that instance?

Stephen Twigg: Obviously I am happy to consider all the evidence from other countries about what works and what does not. The research evidence about abstinence-only education in the United States suggests that it is not effective on its own, although it can be one element of a package of measures to teach young people about sex and relationships. I am happy to examine the specific evidence from Uganda that the hon. Gentleman has drawn to the House's attention.

Jonathan R Shaw: Is not there a parallel between the development of the Sure Start programmes that have local autonomy and the teenage pregnancy strategies? Although they build on professional integration and working with the community, is not it important to share good practice to get the best out of the investment that we have made, as well as clear guidelines? If specific teenage pregnancy strategies work, other people should be told about them. If people do not want to find out, guidelines should be issued.

Stephen Twigg: My hon. Friend is right. In the past two years, there has been a disappointing, if small, increase in teenage conceptions, although there has been a significant fall, especially in conceptions among under-16s, across the four years of the strategy. We are now doing precisely what my hon. Friend suggests and focusing our attention especially on the hot spotswards in the country that have particularly high levels of teenage pregnancy. Something like 50 per cent. of teenage conceptions happen in one in five local government wards. I am prepared to consider the available guidance in the way in which my hon. Friend suggests.

Graham Allen: Will my hon. Friend ensure that any guidance that he issues is flexible so that it is relevant to areas of chronic educational under-attainment such my constituency? I recently had a letter from a primary head teacher, who said that, at 10 and 11, the sexual education that the youngsters receive is irrelevant because they know far more than what is being taught. That is a sad fact to relate to my hon. Friend. Will he ensure that we do not have a one-size-fits-all programme and that people are allowed the flexibility to meet the needs of their circumstances?

Stephen Twigg: My hon. Friend is right. Flexibility is critical and it is vital that we learn from best practice in different schools and different communities. It is also important that teachers and others who work with young people in our schools have the confidence to address those issues. Evidence shows that teachers sometimes lack that confidence. We place great emphasis on continuing professional development for teachers so that they can deliver sex and relationships education with confidence in the classroom.

Primary School Funding

Paddy Tipping: What the average spending is per primary school pupil in England in the current financial year.

Charles Clarke: Average revenue spending from the schools budget in 200405 is 3,120 per maintained primary school pupil. As part of our package to restore stability to school funding, we guaranteed all schools an increase in their funding this year of at least 4 per cent. per pupil. More than two thirds of schools received an increase above the guarantee and the remaining third, an increase in line with the guarantee.

Paddy Tipping: Is my right hon. Friend in a position to compare that impressive figure with that in, for example, the financial year 199697? If he could do that, would he find that primary school budgetsfor example at the Annie Holgate infant school, which he has visited in Nottinghamshirehave doubled?

Charles Clarke: I am not in a position to make the exact comparison but I can give the comparison in real terms with the year 199798. In Nottinghamshire, the total recurrent funding for pupils aged three to 19 increased by 760 per pupil in real terms since 199798, with the effect that my hon. Friend described. Anybody who goes into schools would have to acknowledge the massive increase in resourcescapital spending as well as revenue spendingthat drives up educational standards. That is a major dividing line between the Government and the Government whom we succeeded. I hope that everyone will bear that in mind when considering the choices that they have to make.

Patrick McLoughlin: Will the Secretary of State explain why a primary school child in Nottingham gets more money than a primary school child in Derbyshire?

Graham Allen: They have good MPs.

Charles Clarke: One of my colleagues suggests from a sedentary position that the reason is the quality of the Member of Parliament, but I am sure that that cannot be part of the explanation in any respect whatever. The fact is that different children have different needs in different parts of the country. But in Derbyshire, Nottingham and every part of the country, there has been a massive increase in resources in every school, for every child. That is something of which this Government are rightly proud.

Anne Campbell: My schools in Cambridge are extremely grateful for the extra money that has been received throughout this Government. May I point out to my right hon. Friend[Interruption.]

Mr. Speaker: Order. The hon. Lady is addressing the House.

Anne Campbell: May I point out to my right hon. Friend that Cambridgeshire county council is still not receiving the amount of funding that it was led to expect in 2002 that it would receive, which means that schools, in some cases, are still underfunded, even though funding has improved so much since 1997? I hope that he will join me in making representations to the Office of the Deputy Prime Minister on the need to increase their funding in line with what they would expect to receive.

Charles Clarke: First, there is an announcement later on these matters, after the pre-Budget report. Obviously, my hon. Friend is right to make the case for Cambridgeshire as she does. In relation to Cambridgeshire, it is very important that schools there work well with the local authority, as there have sometimes been issues that have not been as straightforward as they might seem; I urge them to do that. In addition, I acknowledge her point that the increase in spending since 1997 in Cambridgeshire has been dramatic, and is raising significantly standards in schools in Cambridgeshire.

Level 3 Entitlement

Ross Cranston: What assessment he has made of level 3 entitlement provision.

Ivan Lewis: We set out in the skills strategy the ways in which we propose to improve opportunities at level 3 for adults, targeting support to meet regional and sectoral skill needs. We are maintaining fee remission for those on low incomes. For 16 to 19-year- olds, those who are able to benefit can pursue study through to level 3 achievement, through academic or vocational study in schools, colleges or apprenticeships.

Ross Cranston: May I ask how we make significant progress at level 2 and basic skills level so that we have the base to move on to level 3 attainment? In addition, may I ask him about a problem raised with me by Dudley college about funding? Will funding for level 2 crowd out funding for level 3 and, in particular, might employers be dissuaded from funding level 3 attainment?

Ivan Lewis: First, my hon. and learned Friend is right to make the point that we need to support progression all the way from basic skills to level 3. We were proud to announce only two weeks ago that we hit our target, so that 750,000 adults who did not have basic literacy, numeracy and language skills before we came to power have achieved those skills in the past few months, which is a major achievement. At the moment, we are trialling our level 2 entitlement in two regionsthe north-east and the south-eastwith a view to rolling that out across the country. We have already spoken this morning about employer training pilots.
	We are also committed to ensuring that where there is market failure in regions or sectors of the economy, we would be willing to consider extending level 2 entitlement to 100 per cent. subsidy for level 3. But as a matter of principle, in relation to achieving level 3 qualifications, it is reasonable to expect, on the whole, a greater contribution from employers and individuals because, at that level, they have a direct gain and benefit. In relation to where we put the bulk of the Government's resources, it will go unashamedly into basic skills and level 2 qualifications. In terms of the needs of the economy, level 3 and higher qualifications are equally important, but we will expect a greater contribution from employers and individuals at that higher level.

Skills Gap

Eric Illsley: What steps he is taking to close the skills gap.

Kim Howells: In July 2003 my right hon. Friend the Secretary of State launched the skills strategy White Paper. Since then we have made significant progress, setting the foundation for future activity. There are 20 sector skills councils in place, over 12,500 employers and 80,000 employees benefit from employer training pilots, since 2001 over 750,000 learners have achieved a skills for life qualification, and over 620,000 more adults are qualified to at least NVQ level 2 or its equivalent.

Eric Illsley: At a recent event in my constituency hosted by the local chamber of commerce, we heard encouraging news about the initiatives that my hon. Friend has mentioned. However, one issue that was raised was the lack of basic skills among some school leavers and other young people going into the world of work. The situation is a little worse in my area, because for the first time for ages we have full employment. Will my hon. Friend bear it in mind that we need to encourage better numeracy and literacy among young people going into employment?

Kim Howells: I agree that that is vital. I have visited some wonderful colleges of further education where 14-year-olds are at last waking up to learning. That is long overdue. Those young people have either excluded themselves or been excluded from school, or else school simply did not work for them. It is amazing to see them working on automobiles, welding or electronics.
	Those young people do not talk of basic skills or core skills but of reading, writing and arithmetic. I have made a point of asking them what they think of having to do all that. They saythis is a wonderful thingWe do not like it, but if we did not do it they would not let us in here. That is a great trick, and it just might work. If so, we will see skills start to increase to the benefit of everyone, not least the economy.

Charles Hendry: Does the Minister agree that if we are to close the skills gap, it is vital for young people to be aware of the employment and career paths that are open to them and of what is required to gain access to those paths? Does he accept that while accessible careers advice from universities is fundamental, it is being compromised by being mixed up with other advice for young people through the Connexions service? Will he consider removing careers advice from Connexions, so that young people can be guaranteed the independent careers advice that they so badly need?

Kim Howells: I understand that we are reviewing all that and will produce a Green Paper. The hon. Gentleman is right to raise the issue. I am amazed at the number of agencies out there and I have been trying to draw a map of them. I think that people are often confused by the sheer wealth of advice. We need to make the system much simpler, and I think that the review will be an interesting exercise.

Tony Lloyd: I agree that genuinely exciting things are happening in further education and in skills training generally, but our hon. Friend the Under-Secretary of State for Education and Skills mentioned market failure, and we know that there are bad and indifferent employers, and freeloading employers, who will not shoulder the burden of upskilling their work forces. It is vital for the country's future that we ensure that all involved play an active and proper part. Will my hon. Friend continue to monitor the skills gap, and ensure that the possibility of introducing an element of compulsion where necessary will not be ignored?

Kim Howells: We have been developing sector skills councils to drive forward that agenda. I certainly do not want public money to go to companies that do not have an agreement with a sector skills council to ensure that it is used properly, that good education and training are being provided and that that is seen as a vital part of economic development in every part of the country.

Educational Psychologists

David Heath: When he will announce his decision in respect of the future training of educational psychologists.

Stephen Twigg: Educational psychologists play an important role in supporting children with special educational needs and behavioural, emotional and social difficulties. Their future training will need to reflect the changing role of the work force involved in children's services, and we will publish a consultation paper on this in January. We are also planning a review of the functions of EPs, which we aim to complete by the end of 2005.

David Heath: That is a very disappointing reply. When I had an Adjournment debate on the subject six months ago, which the hon. Gentleman answered, we had already had the consultation and agreed the general shape of educational psychologists' training. The view was taken that we should move to three-year postgraduate training instead of the current teaching qualification. The problem is that many of the people leaving university and who are still engaged in such education do not know what they should do with their future careers and on what course they should enrol. It seems unfair that the Government should shilly-shally on this issue, if we are to have a properly motivated educational psychologist caucus in future to do the job that we want. Will the Minister please try to reach a decision, and to make sure that the people whom we want to train as educational psychologists know what qualifications they should have?

Stephen Twigg: I am sorry to have disappointed the hon. Gentleman, and I do want to acknowledge the interest that he has shown in this issue by securing the Adjournment debate to which he referred. We are absolutely determined to get this right, and it is clear that a great deal is changing in respect of children's services and some other services provided through schools. We want to ensure that the review of the role of educational psychologists is absolutely part of that wider review of children's services, so that the particular needs of the children with whom EPs work are properly met. That is the purpose of the review.

Children's Commissioner for England

Win Griffiths: When he last met his counterpart in the National Assembly for Wales Government to discuss the role of the Children's Commissioner for England in Wales.

Margaret Hodge: I had contact with various representatives of the National Assembly for Wales during the passage of the Children Bill in 2004, including the First Minister and the Minister for Health and Social Services. Discussions have also been held with the Minister for Education and Lifelong Learning, the latest of which was on Monday.

Win Griffiths: I thank my right hon. Friend for that reply. She will know that during the Children Bill's legislative passage, the concern was expressed that problems could arise if the commissioner for England carries out his duties in Wales while the commissioner for Wales continues to have a role in Wales. I urge my right hon. Friend to do everything possible to ensure a seamless service for children in Wales, and to ensure that there will be no confusion between the work of the Children's Commissioner for Wales, and that of the commissioner for England when operating in Wales.

Margaret Hodge: I am aware of these concerns, which have been expressed by my hon. Friend and others on several occasions. I hope that he shares my delight at the Children Bill's having become an Act. We have advertised the post of the first children's commissioner for England, and we hope to appoint someone shortly after Christmas. I am sure that the new commissioner will want to meet the commissioners in the other countries and to ensure a seamless service for children, wherever they live.

Adam Price: Is it realistic to expect vulnerable children to know the difference between devolved responsibilities and those that are not? Surely a better solution would be a single commissionera single port of callas suggested by the Welsh Affairs Committee and the National Assembly for Wales.

Margaret Hodge: All children will be competent and able to ensure that their rights and concerns are expressed to wherever is appropriate. We will ensure, and all the commissioners will doubtless want to work together to ensure, that children's aspirations, needs, priorities and concerns are heard loud and clear in this Chamber, as well as in other areas of public life.

Julie Morgan: I am very pleased that my right hon. Friend has advertised the post of children's commissioner for England. Has she discussed with officials in Wales how the Children's Commissioner for Wales was appointed? She will doubtless be aware that children were involved in the advertisement and shortlisting, and in the actual appointment of that post.

Margaret Hodge: My hon. Friend will be pleased to hear that we have ensured that children in England are involved in the job specification of the children's commissioner for England, and in the advertisement design. Indeed, they will themselves be interviewing candidates.
	We are determined that the commissioner will be a powerful champion of children and I am sure that we will hear the voice of children loud and clear once the post is filled.

Mathematics Teaching

Vincent Cable: If he will make a statement on the progress made in implementing the recommendations of Professor Adrian Smith's report regarding mathematics teaching.

Charles Clarke: We continue to make good progress in taking forward the measures for mathematics teaching announced on 28 June. In particular, on 9 December, I will be inviting expressions of interest from organisations to create and run the national centre for excellence in the teaching of mathematics. Advertising has begun to promote increases in training bursaries and golden hellos from September 2006. There has also been a welcome increase of 4 per cent. this year in recruitment to mainstream teacher training courses in mathematics.

Vincent Cable: Does the Secretary of State recall Professor Smith's words that there was
	a dire, catastrophic, crisis-level shortage of specialist maths teachers?
	Does he also recall that in an Adjournment debate six months ago, I was told that the Government were considering writing off the debts of maths and science teachers? How far have the Government got with that initiative and other inducements to maths teaching?

Charles Clarke: As I have already said, we have already started advertising to promote increases in bursaries and golden hellos for the next academic year. The strong point that I would like to make is that Professor Adrian Smith and my recently appointed chief adviser, Professor Celia Hoylesan outstanding individual in the subjectwould both acknowledge that we are working extremely expeditiously to deal with the matter. I am committed to increasing the number of mathematics teachers, and the Government have a strong record on such matters.

SOLICITOR-GENERAL

The Solicitor-General was asked

Crown Prosecution Service (IT Systems)

David Kidney: What assessment she has made of the effectiveness of the IT systems available to the Crown Prosecution Service.

Harriet Harman: I have kept a close eye on the development of the Crown Prosecution Service IT system, which is called Compass. My assessment is that it helps with the timely and efficient management of cases by the CPS and helps it account to the House for what it does. More generally, the criminal justice system IT offers the prospect of better communication between the police, the CPS, courts and defence lawyers and of keeping the victim and witnesses informed of what is happening in cases in which they are involved.

David Kidney: I thank my right hon. and learned Friend for that reply. It was the Glidewell report that recommended modern IT systems for prosecutors and we surely have here a public sector IT system that has been introduced successfully. We should all be pleased about that. Is my right hon. and learned Friend aware that in Staffordshire, as a result of new electronic systems, the CPS is more effective, more accurate in the advice that it gives, delivers a faster service and is well placed to do a good job in respect of electronic links with the police and the courts?

Harriet Harman: I am sure that the Crown Prosecution Service in Staffordshire will warmly appreciate my hon. Friend's comments, but he is inviting me to tempt fate by telling the House that it is probably the only computer system in government that is working properly. There has been a good deal of investment56 million over the next 10 yearsand the prosecution system has gone from a largely paperwork system to one that had three computers on each prosecutor's desk and now to one single system that is joined up with the rest of the criminal justice system.

Graham Allen: Will the Solicitor-General commend the work of Nottinghamshire Crown Prosecution Service and its chief prosecutor, Kate Carty, in introducing information technology systems? Will she also ensure that excellent IT is complementary to, and not a substitute for, the softer skills of local prosecutors meeting police officers and the local community informally to deal with misunderstandings and undertake a process of mutual education?

Harriet Harman: My hon. Friend is right and I thank him for his comments on the workings of the CPS. Of course it is important that people communicate not only through IT but in person and that the CPS work closely not only with the police and the courts but with the local community and MP. I welcome the involvement that he seeks with the CPS, which is after all an accountable service, although it works independently.

Serious Organised Crime Agency

Hugh Bayley: What relationship the Serious Fraud Office will have with the Serious Organised Crime Agency.

Harriet Harman: The Serious Organised Crime Agency will bring together the National Crime Squad, the National Criminal Intelligence Service and the drug trafficking investigative and intelligence work of Customs and Excise into a single agency to lead the fight against organised crime. The Serious Fraud Office will continue to investigate and prosecute serious and complex fraud. The Serious Organised Crime Agency will offer support to the SFO in its investigations and the SFO will advise SOCA.

Hugh Bayley: I am grateful to my right hon. and learned Friend for that answer. Unlike France and some other countries that have mounted successful prosecutions, as they are obliged to do under the Organisation for Economic Co-operation and Development convention against international bribery, the United Kingdom has yet to do so. The Serious Fraud Office has expressed concern that it does not have sufficient resources to investigate these complex cases abroad, but it is important to investigate them because they undermine development in so many developing countries and those responsible for taking bribes internationallycorrupt politicians and officialsuse the same money-laundering channels as organised crime. Will SOCA be able to provide support to the SFO to investigate some of these cases and secure prosecutions?

Harriet Harman: Yes, it will. I agree with my hon. Friend about the corrosive effect of corruption in developing countries and that we have to do what we can to tackle those giving and taking bribes. We are working closely with the international community. The SFO's budget rose to 23 million and will increase again to 35 million. That will enable it to increase its staff to 300, which will include lawyers and accountants.

John Burnett: Two of the most important weapons in the fight against crime are intelligence and co-ordination. Will the right hon. and learned Lady give the House the three most compelling reasons why the investigations arm of the SFO is not to be merged into the Serious Organised Crime Agency?

Harriet Harman: I think that they will work together, but the work of the SFO involves a prosecution process, while that of the Serious Organised Crime Agency is largely investigative. The SFO will work closely with SOCA, but it will continue to prosecute, just as Customs and the CPS will continue to prosecute when information comes before them from SOCA.

Fraud Prosecutions

Henry Bellingham: What plans she has to ensure effective prosecutions of those who commit fraud against small enterprises.

Harriet Harman: Effective prosecution of fraud against small business depends on good police investigation and evidence gathering, and close working between police and prosecutors. It is also important for small business to do what it can to protect itself against fraud. Both the Home Office and the Department of Trade and Industry have advice on their websites about how to recognise fraudulent approaches.

Henry Bellingham: I thank the right hon. and learned Lady for that reply. Is she aware that there has been a significant increase in the number of small businesses that have fallen foul of so-called phishing scams, in which the sender of the e-mail tries to get their banking password, and of scams from countries such as Nigeria, in which the sender promises a commission on money that is wired to the recipient? What is she doing to try to protect small businesses from such scams?

Harriet Harman: I am aware of those attempted scams. The hon. Gentleman has raised them and brought them to the attention of the authorities. I thank him for doing that because it helps warn small businesses of the problem. I would say to small businesses, and everybody who sees offers on the internet[Interruption.]

Mr. Speaker: Order. These are very important matters. The House must come to order.

Harriet Harman: I would say to small businesses that they cannot get something for nothing and that if they see on the internet offers of huge sums without having to do anything, such offers are probably a scam. I am sure that the hon. Gentleman will welcome the new guidance on policing priorities for fraud cases that the Home Office sent out, which says that, even if the sum involved is small, if the effect on the small business victim is large, it should be a priority for police investigation and prosecution.

Extradition

David Heath: What guidance is given to the Crown Prosecution Service on the consideration to be given to requests for extradition by foreign Governments in determining whether to prosecute an individual in the United Kingdom.

Harriet Harman: The Crown Prosecution Service follows the guidance given in the code for Crown prosecutors when deciding whether to instigate or continue a prosecution. If a request for extradition is received in respect of someone against whom a prosecution is under way, the prosecutor will consider whether the public interest is best served by continuing with the proceedings here or discontinuing proceedings in favour of allowing extradition.

David Heath: Does the Solicitor-General see any problem where there is a grossly unbalanced extradition arrangement such as we currently have with the United States of America, which has not even been ratified by the US Congress but nevertheless binds this country to extradite suspects without prima facie evidence? Is she content that that process might be used in circumstances in which a crime had been committed in Britain or upon British citizens and no prosecution had been undertaken by the CPS, but someone stood trial for it under American jurisdiction?

Harriet Harman: The hon. Gentleman is under a misapprehension. The extradition system is not unbalanced. It is for us to decide how we deal with requests for extradition. We have made those decisions and debated them in this House during proceedings on the Extradition Act 2003. Those who were charged to put into effect that legislationthe staff of the CPSact wholly independently, they act in the public interest and without reference to policy, let alone foreign policy matters. The hon. Gentleman alleged that extradition could take place without prima facie evidence, but evidence was put before the Bow Street magistrates court in the case in October to which he refers. The district judge decided that there was sufficient evidence to send it to the Home Secretary who will consider extradition.

Pre-Budget Report

Gordon Brown: At the core of this pre-Budget report is the belief that the Britain of long-term economic strength will be the Britain that at a time of rapid economic change and uncertainty locks in our economic stability for the long-term; the Britain that, as by 2015 Asia acquires a growing share of low-cost production, resolves to invest in high-value-added, high-technology manufacturing and services, and achieves world leadership in science and technology; and the Britain that, with enterprise and high-skilled jobs now the key to long-term prosperity, takes the tough decisions to achieve American levels of business creation and has, at every level, the best educated and most flexible work force in the world. In other words, it is a Britain of opportunity for all that, with this pre-Budget report's long-term measures to support families, ensures that every child and young person has the best start in life.
	I turn first to the measures to entrench stability. In last year's Budget I forecast growth for this year of between 3 and 3 per cent. When I made our forecast, the Leader of the Opposition said that it was not just wrong but a deliberate misrepresentation of Britain's economic position and that not to meet it would destroy credibility. I can report today to the House that growth this year will be, just as I forecast, above 3 per cent. 3 per cent. In other words, Britain will extend the longest period of uninterrupted growth in the industrial history of our country.
	Let me give the House the detailed figures. Even after the doubling of oil prices, inflation this year is 1 per cent. In any other decade, a 100 per cent. increase in oil prices, a 50 per cent. increase in industrial materials prices and a 70 per cent. increase in metal prices would have led to British inflation and British instability. But with continued and necessary discipline among wage bargainers in the private and public sector and with the resilience of the monetary and fiscal framework, inflation is expected to be just 1.75 per cent. next year and 2 per cent. in the years to follow.
	All policy makers will keep a close eye on continuing risks from global trade imbalances, from exchange rate movements and from an uneven world recovery, but with manufacturing output growing this year and next, British business investment is also expected to risethis year by 5 per cent. and next year by 4 to 4 per cent.
	With the expected moderation of house price inflation now under way and as export and industrial production strengthen, domestic demand, which has been growing by 4 per cent. this year, is expected to grow by 3 to 3per cent. in 2005; and we expect consumption to grow by 3 per cent. this year and by 2 to 2 per cent. in 2005.
	Overall domestic investment we expect to grow next year by 6 to 7 per cent. We expect exports to rise in line with world trade at more than 6 per cent. and, with inflationas I have saidbelow its target, growth overall is projected for 2005 at 3 to 3 per cent., in line with the average growth of G7 countries.
	We will remain vigilant to inflationary pressures, both globally and in Britain; but it is the success of the Bank of England's forward looking approach that is the key to sustaining growth with low inflation, just as since 1997 it has maintained both inflation and interest rates at historic low levels. Thepre-Budget report shows that since 1997 interest rates have averaged 5.3 per cent.half the 10.4 per cent. average from 1979 to 1997. Mortgage rates have averaged 6.1 per cent since 1997, almost half the 11.4 per cent. average from 1979 to 1997.
	Since 1997, Britain has 1.2 million additional home owners, and as we take forward the Barker review and the Deputy Prime Minister publishes his five-year housing and sustainable communities strategy, we will also pilot mixed communities in deprived estates and, therefore, provide further support for first-time buyers in our country.
	Since 1997, mortgage rates have been lower than in any seven-year period since the 1960s. Interest rates have been lower than in any seven-year period since the early 1960s. Inflation has been lower than in any seven-year period since the 1930s. Employment has been higher than in any seven-year period since records began.
	Let me sum up for the benefit of the House.
	  Inflation is low. Unemployment is low. We're growing faster than many other European countries.
	That is not, Mr. Speaker, exaggerated gloating, but the words of the Leader of the Opposition, speaking to an employers federation only two weeks ago.
	The strength of our economy is matched by the strength that comes from the decisions we made after 1997 to cut our national debt. Yesterday, I was able to announce 520 million more for the special reserve for Iraq and our international obligations; and I thank our armed forces for their dedication and their courage. Having since 11 September doubled the budget to 2008 for security at home, I am also releasing today a further 105 million for necessary security measures to counter terrorism, to enhance surveillance at our ports and to improve civil resilience.
	The pre-Budget report also sets out detailed savings achieved of 2 billion in procurement, an additional one third of a billion saved in NHS drugs procurement and, on target, the reduction of the first 9,000 civil service posts, as we implement the Gershon principles, a 21 billion efficiency saving that we have achieved while at the same time accepting his recommendation that to go beyond that figure of 21 billion could put the delivery of front-line services at risk.
	I can also announce the relocation of 1,230 Ministry of Defence posts from the south-east to Yorkshire; 2,300 Department for Work and Pensions posts to Liverpool, Wrexham and Newcastle; 600 from the Office for National Statistics to Wales; and 220 from the Revenue and Customs to Cardiff, Liverpool, Bournemouth, Truro and Manchester. Those are further steps on the way to a total, by 2010, of 20,000 civil service jobs relocated to our regions.
	Sir Michael Lyons is also setting out today departmental guidelines for the disposal by 2010 of 30 billion of public assets. And because there is scope for further rationalisation of public sector spectrum, I have asked Professor Martin Cave to lead an audit of public sector spectrum with the aim of releasing the maximum amount of spectrum to the market.
	Lower debt has meant that debt interest payments each year are 4 billion less than in 1997 and because we have more people in work than other countries75 per cent. of adults in work in Britain, compared with 71 per cent., in the United States, 69 per cent. in Japan and 65 per cent. in Germany and Francesocial security bills for unemployment are also down by 4 billion a year since 1997.
	Having previously set both the fiscal numbers and the detailed spending plans for the years 200508, the public finance projections I have set out today are based on our cautious view of trend growth in the years to 2010 and on public spending rising from 579 billion in 200708, to 606 billion in 200809 and then to 634 billion in 200910.
	When, in the Budget, I estimated borrowing for the year to April 2004 at 37.5 billion, some external commentators suggested that that was an underestimate. At the same point in the economic cycle 10 years ago, the equivalent figure was 90 billion, but I can report that our final outturn for the year to April is not 37.5 billion; it is 35 billion. And even after taking into account additional expenditure on defence and security, and other decisions that I will announce today, including on fuel duties and council tax, the cash figures for net borrowing for this year will fall to 34 billion, and in future years, fall further to 33 billion, falling again to 29 billion, then falling to 28 billion, 24 billion and 22 billion.
	The deficit in 2004 is 3.9 per cent. of GDP in Germany, 3.7 per cent. in France, 4.4 per cent. in America and 6.5 per cent. in Japan. In Britain, the figure is 2.9 per cent., and in future years, it will fall to 2.7, 2.2, 2 and 1.6 per cent., falling to 1.5 per cent. of GDP. For those who take an interest in these matters, it is well within the Maastricht criteria of the European Union.
	Our first fiscal rule is to balance the current budget over the economic cycle. For the years to 200910, the current balance is minus 13 billion, minus 7 billion, then plus 1 billion, plus 4 billion, plus 9 billion and plus 12 billion. So we are meeting our first fiscal rule in this economic cycle, and we will meet it in the next economic cycle, too.
	Our second rule is our sustainable investment rulethat we should borrow for investment, while keeping debt at a low and sustainable level. Because of the world downturn, debt has now risen to 45 per cent. of national income in France, 48 per cent. in America, 55 per cent. in Germany and 85 per cent. in Japan, but in Britain this year, our debt is 34.3 per cent. of our national income. In future years, it will be 35, 36, 36, 37 and 37 per cent., meeting at every point our rule that debt should be kept below 40 per cent. of national income.
	So with our deficits lower than our competitors' and lower than in past decades, and with our debt lower than our competitors' and lower than in past decades, we are meeting both our fiscal rules: in this cycle, our first rule, with a margin of 8 billion and our second rule, with a margin of 59 billion, and we are therefore on course to meet both our rules in this cycle and in the next cycle, too.
	The measures that I now announce for this pre-Budget report are informed by the Treasury's assessment, published today, of long-term global economic challenges to 2015. To succeed in the global economy, Britain should build on our strengthsour stability, our scientific genius and our world-class universities and our global reachwith a concerted national mission to invest long term and establish world leadership in science, education and skills, and enterprise.
	To build on our new 10-year science framework and the 2.5 billion investment in science and to make Britain the best place for research and development, we will continue our reforms to re-examine the R and D tax credit for mid-sized science-based firms; to remove tax barriers to the formation of university spin-off companies; and to pilot a matched-funding scheme to help universities to build up their resources through new endowments. To benchmark progress in raising business R and D, we will establish an industry-led science forum chaired by the chief executive of AstraZeneca, Sir Tom McKillop, and as part of their 100 million technology investment programme, the northern regional development agencies are together announcing that they will promote science cities for the north, starting with Manchester, Newcastle and then York.
	By 2015, Asia will be responsible for as much as 25 per cent. of world trade, yet, today, only 1 per cent. of British exports go to India and only 1 per cent. of our exports go to China. So having set an objective to build trade links with Asia that match those that we have with America and Europe, we propose that the China-UK financial dialogue now expand its role, with enhanced private sector participation, and that the new UK-India dialogue is also broadened to include private business. And a new Asia taskforce will bring together experts to focus on boosting British exports to, and investment in, Asian countries in the years to come.
	In the years to 2015, the greatest number of new jobs will come from a larger number of small businesses, and that is why we must achieve American rates of business creation and success.
	For long-term investments, I have already reduced capital gains tax from 40p to 10p. I have cut corporation tax from 33p to 30p and cut small business tax from 23p to 19p. We will legislate for tax relief for the renovation of empty business premises in our 2,000 enterprise areas, and through deregulation and self-certification of business angels we will remove barriers to high net-worth investors, enabling them to invest directly in small businesses. We will align the tax treatment of leasing with other forms of finance. For new and ambitious start-ups and high-growth businesses, we have asked the development agencies to make available in every region tailored coaching and support. Building on the success of Britain's first ever national enterprise week, detailed guidance is being issued for schools on the content of enterprise lessons.
	In recent Budgets, we have removed the independent audit requirement on small firms, introduced a simplified VAT flat-rate payment scheme, and I am today publishing the interim report of Philip Hampton on rationalising inspection and enforcement regimes. Having concluded that outside high-risk areas, the regulatory focus should be on advice, not inspection, and that data-sharing should avoid duplication of requirements on business, his final report will include recommendations to reform the regulators charged with inspection and enforcement and to reform the penalty regimes.
	In parallel, the new executive chairman of the Inland Revenue and Customs and Excise, David Varney, is also today announcing the creation of a small business unit, consulting on the scope for a single tax return that would bring together all taxes, and setting as his long-term objective a single account for payments by business.
	I am also announcing further detailed reforms that include deregulation in the financial services industry and common commencement dates from 2005 for all new health and safety, company and consumer legislation. Building on what the Foreign Secretary has already announced, he is setting out new rules guiding implementation of European Union regulations.
	In the coming decades, as populations age and the dependency ratio grows, the most successful economies will be those that encourage the maximum number of people of working age into the labour market. Alongside greater local and regional pay flexibility, the Secretary of State for Work and Pensions and I agree that it is time to do more to attract into the work force incapacity benefit recipients with the capacity to work and lone parents who at the moment are not able to work.
	By extending our successful in-work credit, 250,000 lone parents throughout our country will be offered a 40 a weekthat is 2,000 a year first-year return-to-work bonus. Incapacity benefit claimants, under the successful pathways to work scheme, will have a 40 a week return-to-work credit allied to rehabilitation help, which has been the most effective way of helping incapacity benefit claimants into work. This will now cover a third of the country, on the road to making this a nationwide offer. We will build on successful experience by also locating employment advisers in GPs' surgeries. We are allocating today 30 million more to expand the numbers who can benefit from the new deal for disabled people.
	To make work pay, I am also raising the national minimum income guarantee for a single earner couple with one child to a guaranteed income in work of 258 a week, and a lone parent working part-time with one child on the minimum income guarantee will receive 199 a week, the equivalent in work of 12 an hour.
	With unemployment among ethnic minorities still twice that of the rest of the population, and the proportion in work just 59 per cent., I have asked the National Employment Panel, working with the Ethnic Minority Business Forum, to report by Budget time on measures to address what is a waste of potential by encouraging employment, self-employment and the growth of small businesses.
	Because of the environmental challenges that all nations confront, our 2005 G8 presidency is going to give priority to climate change. It is the view of this Government that all industrialised nationsfrom the smallest to the largestmust accept their responsibilities and each must bear its share of the burden in reducing greenhouse gas emissions.
	Oil prices have declined from the peak of $50 a barrel, and today are $42. They are well above the long-run average of $23, and they make promotion of energy efficiency and alternative lower carbon sources of energy far more urgent. For Britain's part, the Secretary of State for Environment, Food and Rural Affairs is going to review the innovative technologies and policies that can deliver that step change in energy efficiency. As a first step, she is announcing today measures to accelerate innovation in energy efficient technologies, with the creation of a development fund of 20 million managed by the Carbon Trust.
	It is our policy that, each year, fuel duties should rise at least in line with inflation as we seek to meet our targets for reducing polluting emissions and fund our public services. But this financial year, because of the sustained volatility in the oil market, I propose to match the freeze in car vehicle licence duty with a continuation of the freeze on the main road fuel duties. While we will not set a duty differential this year for sulphur-free fuels, we will go ahead with the 20p per litre lower duty differential for bioethanol on 1 January 2005, matching the equivalent differential for biodiesel. Because of oils fraud and the tax evasion that has resulted from the lower rate of duty for rebated oils, it is not right to delay the planned increase on this duty, but I will set it not at the expected 2.4p per litre but at just 1p a litre.
	Further anti-avoidance measures published in detail today include action against avoidance on contrived remuneration arrangements, on financial and international transactions, on VAT and on the abuse of the 1992 film tax legislation.
	The limit on the value of overseas purchases from outside the European Union, brought back into this country through customs duty and tax free, has been set by the European Union at 145, excluding alcohol, tobacco and perfume. I have written today to the European Commission and member states stating that this limit was last revised in 1994, is now out of date and that we should now raise it.
	With the Commission for Africa reporting next year and with the focus for our G8 presidency on debt relief and development, the Secretary of State for International Development and I have written to G8 Finance Ministers saying that our priorities for 2005 will be to institute the international finance facility; 100 per cent. multilateral debt relief; to develop the development round in trade; and, as the second largest donor in the fight against HIV/AIDS, to maximise efforts to develop an infrastructure for co-ordinating research for a cure for AIDS, increase funding for AIDS research and develop innovative advance purchasing agreements for drugs for both AIDS and malariaBritain making its G8 presidency count to meet the needs of the developing world.
	Also, 2005 is the year of the volunteer. To encourage voluntary work, the Home Secretary and I are ready to take forward the Russell commission's proposals for a national youth volunteering and community service. I will report back in the Budget.
	The long-term review of English local government finance under Sir Michael Lyons will report next year, but it is also right to take action where there are immediate pressures this year. In order that English council tax rises will be substantially below last year's 5.9 per cent., I am able to release the following: an extra 125 million resources for England, alongside 521 million reallocated to local councils from Government Departments and a further one third of a billion reallocated from the reduction in ring-fencing and other obligationsin total 1 billion to reduce pressures on the council tax. The Minister for Local and Regional Government will later this afternoon give full details, including on the position of pensioners.
	Since 1997, 1 million pensioners have been lifted out of poverty. Raising the basic state pension by earnings would have provided an average of 5 a week more for the poorest pensioners. But the pension credit and our other measures have ensured that many are over 40 a week better off. I can confirm that, next year and in the spending round, the pension credit will rise faster than inflationby average earningsmeeting our obligation to take hundreds of thousands of pensioners out of poverty in this country.
	To help savers, it is right to extend the tax free advantages for the first 7,000 of savings3,000 for the cash componentin individual savings accounts each year. So I am consulting, prior to the Budget, on extending the ISA limit for another five years to 2009. We will proceed from April with the low cost savings and investment products recommended by the Sandler report, and we will now extend our savings gatewaythe scheme where the Government match the savings of low-income familiesto a wider range of income groups.
	Two million families still have no bank account. It costs them more to pay their bills, credit costs more and it makes it harder for them to do many things, including, on some occasions, getting a job. I can announce that the banks and Government have agreed to work together to reduce by half the number of families without bank accounts. To expedite this, we are setting aside 120 million to tackle financial exclusion, including more face-to-face money advice, supporting local citizens advice bureaux, support for not-for-profit lenders and with the possible extension of the community investment tax relief.
	Our child trust fund will build savings and wealth for every child in the country. In addition to the 250 and 500 down payments that families will receive early next year, we will now consult on extending the child trust fund so that, at the age of seven, we add to the 250 and 500 with another 250 and another 500 for the poorest child in poverty. I hope that, given the long-term commitment that this proposal involves to invest in every child in our country, every political party in the House will now support the child trust fund.
	It is because of sustained growth and, after 1997, the prudent reduction of debt and debt interest payments that we can make extra resources today available to local authorities, we can meet the costs of Iraq and the fight against terrorism, we can freeze fuel duties to deal with the impact of the oil price rise, do more to equip the country for the challenges of the long term and are still able to meet all our fiscal rules, with levels of debt and deficit below all our main competitors.
	Within the overall fiscal figures, I am now also able to move forward our long-term agenda for opportunity for all: to make Britain ready to meet the global challenge by moving people from low-skilled jobs to high-skilled jobs, with a new programme to improve skills and employment in our country and to ensure opportunity for every child while meeting the demands of modern family lifea 10-year child care strategy for Britain.
	Since 1997, with education maintenance allowances, modern apprenticeships and the new deal, our priority has been to ensure that no teenager in the United Kingdom after 16 should be outside employment, training or education. With the Queen's Speech legislation to extend benefits to teenagers staying on in unwaged training as well as in college or school, we are removing from teenagers the remaining financial barriers so that every young person can stay on in education or training after 16 to get the qualifications that they need.
	But we know also that 80 per cent. of the 2015 work force have already left school and are in the world of work, and it is their skill levels and their qualifications that will, over the next decade, determine the prosperity of our country. So a policy of opportunity for all must provide opportunity for those who have missed out and who should, in the economic interests of the country, have a second chance.
	Today 30 per cent. of employees have very low skills or no skills at all. We have, unfortunately, the highest proportion of unskilled of any major European Union country. The unskilled worker is four times less likely to be offered training in work than the highly qualified. For decades, low skills have been an Achilles heel of Britain as a modern economy and the post-war laissez-faire training system has not, and will not, meet the skills needs of our future.
	Learning from successful training policies among our European competitors and building on the 100,000 individual success stories of those given time off for training through what have been called the employer training pilots in Britainthe majority who have benefited from them are women, the majority of them have no prior skills and the vast majority of them successfully attain their qualificationswe are able to announce today their roll-out to the whole country, creating for the first time in Britain a national employer training programme, with employers recognising their responsibilities to offer time off, employees recognising their responsibilities to take up the opportunities and the Government recognising our responsibilities to play a part in funding the training.
	Since the Budget, lower spending on unemployment has released resources, which means that, together with additional money reallocated by the Secretary of State for Education and Skills, the funds are now available for every employer to make an offer to every adult employee without skills. In future, every adult who has missed out at school will have the funds and the opportunity to acquire skills, starting with a level 2 qualification equivalent to GCSEs at A to C, through time off, free training provision and the help on offer from employers.
	With that national employer training programme, combined with the new deal for skills, the offer is, for every adult without skills, in or out of work, a skills check-up and free training provision to achieve level 2 qualifications. And to extend this offer more widely to the unskilled out of work and on benefit who, up until now have been debarred from training by the 16-hour rule, we propose to pilot an additional 10 a week learning allowance.
	Britain's future as a productive nation depends on a shared determination, from parents and teachers to management and trades unionists, that the acquisition of skills by all and their continuous upgrading is a shared national purpose. In furtherance of this, the Secretary of State for Education and Skills and I have asked the chairman of the National Employment Panel, Sandy Leitch, to build on today's decisions, report on the long-term skills needs for intermediate and degree level skills in the economy, and work with employers throughout the country to ensure that every employee is offered those new opportunities.
	The successful economies and societies of the next 20 years[Interruption.] They have some rethinking to do. The successful economies and societies of the next 20 years will also invest in the potential of all children. We want to transform the way parents are enabled to balance work and family life. A long-term strategy for children and child care starts from recognising two facts of modern life: that the life chances of children are critically determined by the care, support and education they can receive in the years before five as well as after five; and that while 50 years ago fewer than a third of married women were working, today over two thirds of two-parent families have two earners striving to balance the needs of work and family life. The Government's response to this new reality must start from the enduring principles of the Beveridge report: that the family is the bedrock of society; that nothing should be done to remove from parents their responsibilities to their children; and that it is in the national interest to help parents meet their responsibilities.
	As part of the new 10-year framework that we are announcing today, the Government set out and make the choice to allocate funds for new reforms in the coming Parliament. First, parents should be able to stay at home longer when their child is born and have the means to do so; secondly, parents should enjoy more flexibility in the workplace when their child is young; thirdly, parents should be guaranteed more accessible, affordable and safe child care while they are at work; and, fourthly, at all times their children, no matter what their background, should enjoy the highest-quality education and carea welfare state that is truly family-friendly for the first time in its history.
	The first choice that parents want is more choice to stay at home. Building on the extension of maternity leave from 18 to 26 weeks, the increase in maternity pay from 56 a week to more than 100, and the introduction of two weeks' paid paternity leave already in this Parliament, we will for the first time respond to the case made to us for greater choice, and we will make paid maternity leave transferable from mothers to fathers. Parents want more flexibility to be with their children not just in the infant years but as their children grow up, so the Secretary of State for Trade and Industry will consult on extending what has been the successful right to request flexible working, which has already helped 800,000 parents, to parents of older children, again creating more choice and more flexibility for today's parents.
	Secondly, having taken the best educational advice about the learning needs of children, and building on the successful introduction of free nursery education this year for three and four-year-olds, the Secretary of State for Education and Skills and the Minister for Children, Young People and Families will, from April 2007, extend our free nursery education to 15 hours a week, as we move towards our long-term goal of 20 hours of free nursery care for 38 weeks a year for every three and four-year-old child.
	Thirdly, improvements in the availability, affordability and quality of pre-school and after-school child care are indeed required to meet the needs of working parents struggling to balance the demands of employment and of family life, so the Secretary of State for Education and Skills is today setting aside additional resources to enable schools to remain open from 8 am to 6 pm and to improve the quality and career prospects of those who undertake child care. It is right that parents make a contribution towards out-of-school child care costs, but it is also right, in the interests of both the economy and parents, that we do more for all parents. From April, employers will be able to offer employees, right up the income range, 50 a week extra for child care free of any tax or national insurance. For those on lower and middle incomes we will raise and extend the child care tax credit. It will cover up to 80 per cent. of child care costs, up to 170 a week for the first child and 300 for two or more children, benefiting families on incomes up to 59,000 a year. For a two-earner household on median earnings of 34,000 with typical child care costs, it will be worth an extra 700 a year.
	Our fourth goal is that every child should have the best start in life. There are now 600 Sure Start children's centres, and anyone who has visited them knows that they provide not just children's services but a great focus for community life. By 2008, instead of 600 centres we plan 2,500; and today I can go further and announce that by 2010 in England alone there will be 3,500one for every community, and on average five children's centres in every constituency in the country. As a result of these announcements there will be another 1 million new child care places by 2010. That is a commitment to children and child care worth in total 600 million more by 200708money that could not be delivered if public spending plans were cut by 35 billion.
	I have one further announcement to make for families. So that mothers and fathers can spend more time at home with their young children, I am today allocating 285 million, so that from April 2007 we will extend paid maternity leave. Instead of the four and a half months maximum in 1997, it will rise from six months today to nine months, and we will set a goal of an entire year of paid maternity leave. I can also announce that where the maximum maternity pay and child benefits for mothers at home with their first baby in 1997 was just 2,610 for the first year, it will rise by 2007 to 8,300. Even after inflation that is 5,000 morethe most generous maternity support and support for young children ever in the history of our country.
	A society is judged by its generosity to its children and the elderly, who have served the community all their lives. I can also announce that next year, at a cost of an additional 260 million, for those over 70 we will add to the winter fuel payment with an additional 50 payment. Pensioners aged over 70 will receive a total of 250, and pensioners over 80 will receive a total of 350.
	Stability is the foundation; more investment, not less; now and into the next Parliament; opportunity not just for some but for all and a progressive Britain we can be proud of. I commend this statement to the House.

Oliver Letwin: The Chancellor seems to have noticed that the Prime Minister's friend, Commissioner Mandelson, recently warned him against exaggerated gloating, but he does not appear to have heeded the advice. He prefers to slide over inconvenient facts. He did not take much time discussing the figures for current borrowing, and he did not take much time discussing the golden rule eitherand no wonder: it has been alchemy in reverse, and the golden rule has turned to dross in his hands. The golden rule was meant to be a guarantee that the Chancellor would borrow only to investall talk: he is borrowing to spend. His current borrowing for the first seven months is almost twice as high as his last prediction for the year as a whole, and he has just announced borrowing of 170 billion over six years. Why do the ITEM Club and the Institute for Fiscal Studies say that he has a black hole in his finances of 10 billion? Why do the International Monetary Fund and the National Institute of Economic and Social Research say that he has a 12 billion black hole? Why do the CBI, the Organisation for Economic Co-operation and Development, the British Chambers of Commerce and the all the rest say that, on his spending plans, he will have to raise taxes? Why do 20 of the 21 economists on the Treasury's own panel say the same? Does not the Chancellor feel a little isolated?
	The fact is that the tide is going out on the Chancellor's credibility. The tragedy is that the Chancellor is spending, borrowing and taxing so much because he is not getting value for taxpayers' money. He says that he has a plan to cut waste. Whose waste? It is his waste. We have paid all the taxes. Where has all the money gone?
	This is the Chancellor[Interruption.]

Mr. Speaker: Order. Let the right hon. Gentleman speak.

Oliver Letwin: This is the Chancellor who paid for 1,000 chairs for Ministry of Defence civil servants, each of which would have paid for three flak jackets for soldiers serving in Iraq. That is not the holy grail of value for money. He is not Sir Lancelot, he is Sir Wastealot. The Chancellor's plans to save money are like his promise to borrow only for investmentall talk.
	Last year, the Chancellor's plan for cutting bureaucracy increased civil service numbers by 12,000. This year, he is doing even better. In just five months, in just one newspaper, his bureaucracies advertised 4,000 new jobs. That is a salary cost of more than 150 million. Talking of advertising, is the right hon. Gentleman proud of having increased the Government's advertising budget by 100 million? That is 17,000 heart bypass operations. And that is not the only thing he has increased. He has increased the number of tax collectors twice as fast as the number of nurses; he has increased the number of bureaucrats and support staff in education twice as fast as the number of teachers; and he has increased the bill for management consultants by 1 billion a year.
	The Chancellor says that Britain is working, but it is the bureaucrats, the administrators and the management consultants who are at work. Our public services are not working. After 66 stealth tax rises, why are there 1 million people on hospital waiting lists? Taxes have gone up by 5,000 per year per family in Britain, so why are 5,000 people a year dying from infections picked up in dirty hospital wards? These are fundamental failures of public service delivery. The Chancellor cannot mask them by making grand speeches about the long-term future of the economy, particularly when he himself is jeopardising that future with his taxes and regulations.
	Our friend, Commissioner Mandelson, wants to know why our productivity is not better, and the commissioner is right to ask that question, because the Chancellor has presided over an economy whose productivity growth rate has dropped by a third, an economy that has slipped from fourth to eleventh in international competitiveness, and an economy that has grown more slowly than that of any other major English-speaking country. The Chancellor cannot make up for his failures of public service delivery by parading new schemes. His pledges to pensioners and council tax payers today will not make up for 70 per cent. increases[Interruption.]

Mr. Speaker: Order. If the hon. Member for South Shields (Mr. Miliband) wants to carry on a conversation, he should go outside the Chamber. As a Minister, he should know better.

Oliver Letwin: I am grateful, Mr. Speaker, but I fear that the irritation of those on the Government Benches may grow. Labour Members do not want to hear it, but the plans announced today will not make up for the 70 per cent. increase in council tax that have driven many pensioners to despair. The Chancellor's plans for financial exclusion cannot make up for the fact that the savings ratio has dropped by a third.
	The Chancellor's grand statements about science will not make up for the fact that 100 university science departments have closed. His scheme for child care will not make up for the lack of discipline in schools. The Chancellor's plans for training will not make up for the fact that one child in three leaves primary school without being able to write properly. The Chancellor's plans for academic research will not make up for the damage he caused when he created the rules that he is now abolishing.
	The country faces great challenges in the years ahead, not least from the emerging economies of the sub-continent and the far east. We have the capacity as a country to meet those challenges, but we will not succeed if we are held back by failed schemes, fat government and excessive regulation. We will not succeed if economic growth is siphoned off to pay for bloated bureaucracy that fails to give value for money. The long and the short of it is that the Chancellor's failure to give Britain's taxpayers value for money will be the terrible legacy of this Government.

Gordon Brown: Why did not the shadow Chancellor tell us the truth? He said on the radio this morning that his plans involve 35 billion of cuts in public spending. Why does he not tell us that the dividing line between his party and ours is that even if he sacked every civil servant in the land he would still have to find 20 billion in public spending cuts before there was even a hint of a tax cut for Opposition Members? Why does he not admit that his policies involve a 1.8 billion cut in transport, a 4.8 billion cut in local government, a 1.6 billion cut in the Home Office and an 800 million cut in international development?
	Sooner or later, Opposition Members will have to face up to the statements being made by the shadow Chancellor, who, while he speaks in the House about waste, bureaucracy and administration, is committing his party in every constituency to sack nurses, teachers, child care workers and home helps.
	We will not take lectures on bureaucracy and waste from the shadow Chancellor, the architect of the poll tax. That was the biggest single administrative cost to the country7 billion for poll tax registration officers, poll tax collection officers, poll tax repayment officers and poll tax compliance officers. The shadow Chancellor is still proud of the poll tax, which was an administrative nightmare.
	As for the economy, does not the right hon. Gentleman accept that productivity is rising, not falling, and that we have closed the gap with Japan, and are closing the gap with Germany and France? Even his shadow Minister for deregulation, in a statement made to private businesses, praises this country and says:
	Places like . . . the UK . . . attract because their tax rates for business are low.
	So why should we take lectures on the economy from a shadow Chancellor who was an adviser to a Government who had 15 per cent. interest rates, 10 per cent. inflation, 1.25 million people in negative equity, and who caused two of the worst recessions to hit our country?
	When the shadow Chancellor speaks about nurses and doctors in the national health service and compares them with tax inspectors, does he not know that 70,000 people in total were employed in the Inland Revenue, and the increased number of nurses alone under this Government is 79,000, and that there are 20,000 more doctors in the NHS? Again, we will take no lectures from the shadow Chancellor about front-line public services and their improvement. He ought to tell us the truththat the cuts that he proposes are not in administration, but go right to the heart of public services, and that he has always believed in privatising health and education. Conservative Members should go back to their constituencies and think again.

Vincent Cable: Last week, the Prime Minister gave us the politics of fear, and this week the Chancellor has given us the economics of complacency. I have always been happy to acknowledge the contribution that the Chancellor has made to economic stability and steady growth, although an awful lot of people who have been caught up in the boom-and-bust cycle in the housing market or in unrepayable debt and collapsing pension funds would be less charitable than I am. It is now clear, however, that there is an additional problem in relation to the Budget. All the independent forecasters say that there is a deficit; it might be a small deficit, but there is a consensus. The Chancellor says that there is not, so who are we to believe?
	There is an issue of credibility and trust, and we cannot have a continuation of a situation in which the Chancellor sets his own tests and then marks them. What we need is the equivalent of a thorough Ofsted inspection of the Government's accounts. The Chancellor already agrees that the National Audit Office should examine some of his Budget assumptions. Why does he not agree to let all of them be examined and to see whether the golden rule has been met, and thereby re-establish some credibility? What has he got to hide?
	It is clear that there are some serious loose ends in Government public spending. The Chancellor has confirmed that he is providing an extra 500 million for the war in Iraq. The total cost to the British taxpayer of the successful first Gulf war was 500 millionthe same sumand 80 per cent. of the costs were fully paid by grateful European and Arab allies. The current war has cost seven times as much3.5 billionand is growing at 125 million a month, with no end in sight. If the forces are to stay in Iraq until the beginning of 2006, as the Prime Minister said, will the Chancellor confirm that that will cost an additional 1 billion, which he will have to find?
	What about the identity card? Its cost was originally put at 3 billion. On Tuesday, the Home Office said that the card was going to cost 5.5 billion. Yesterday, the Prime Minister did not know. Can the Chancellor tell us how much it will cost and who will pay the cost overrun?
	It is because the budget is tight that we simply cannot afford a reckless George Bush-style tax-cutting spree of the kind that the Conservatives have trailed in the Daily Express. I am told that the proposals were considered so implausible that more cerebral and moderate newspapers such as The Sun and the Daily Mail would not even publish them, but since the proposals are essentially about titillation rather than satisfaction, it is perhaps appropriate that they have found a home in Mr. Desmond's publications.
	On taxation, what is required is simpler and fairer taxation. The Chancellor has endlessly tinkered, and has created a complete mess as a result. There is a very revealing table in the Adair Turner report on pensions showing that 40 per cent. of all pensioners are now paying a marginal tax rate of more than 50 per cent. Some 1.5 million hard-working families are now paying a marginal tax rate of more than 60 per cent. The Government criticise the Liberal Democrats because we propose that very rich people should pay a marginal tax rate of only 50 per cent. So why does the Chancellor think that this situation is tolerable for millions of pensioners and hard-working families?
	While I am on the issue of unfair tax, let me conclude with this question. The Chancellor said today that he has found 500 million to cut the growth of council tax rates. Has he dropped his proposal from last year to compensate pensioners with a 100 payment towards their council tax? Will he also say where he got the 500 million from? Is it true, as is reported, that cuts are now having to be made in the education and health budget in order to fund that increase? Would it not be much more sensible to deal with this grossly unfair and regressive tax by getting rid of it altogether and replacing it with a tax based on ability to pay?

Gordon Brown: Let us be clear on where we agree. As the shadow Chancellor told the Today programme:
	The Government's introduced a very good system of independent management and monetary policy . . . They've also introduced some very sensible rules for taxation and which relating to debt and the deficit and they've largely stuck by them.
	I hope that he will accept that, on debt and deficit, the credibility of this Government and the figures that he was contesting today are well established over many years.
	As for the hon. Gentleman's next point about the costs that have to be met, he will know that there is a reserve, and it is the reserve from which we pay for Iraq. As far as identity cards are concerned, the Prime Minister announced the figures yesterday. On the pensioners winter allowance, I have announced the figures today; 250 will be the payment for over-70 households, and it will be 350 for over-80s.
	What the shadow Chancellor does not seem to understand is that it is because we rejected the other policy proposals that he put forward that we now have a successful economy capable of creating growth and generating revenues. It is because we rejected his policy to abolish the new deal that we have cut unemployment, so the bills from unemployment are down by more than 3 billion a year. It is because we did not accept his proposals to raise the national debt in our early years that we have reduced it and the bills from interest payments are down 4 billion a year. It is because we are generating growth, not by following his policies, but by following our policies, that more people are in work, there is more growth in the economy, businesses are investing and we are therefore generating the revenues to pay for our public services. It is for that reason that we are both meeting our fiscal rules and able to sustain the public spending commitments that we made.
	I suggest that the Liberals need to do some thinking at this stage as well. Yesterday, I pointed out that the hon. Gentleman said that he was going to fix the share of public spending in national income at 200304 levels41 per cent. If he were to do that, he would have to cut public spending by 10 billion now. Yesterday, he conceded to go half way in that direction, and said that he would have to cut public spending by 5 billion. Will he be honest enough to tell every constituency in the country about the 5 billion of cuts that a Liberal party election manifesto should be making?

John McFall: I welcome the assurance that the Chancellor has given that the fiscal rules will be observed. No doubt, we will have further questioning on that in the Treasury Committee on 15 December. The child care and family policies that he has introduced are particularly welcome. Surely, as a result, no child in any of our constituencies will be left behind.
	On financial exclusion, the 120 million is most welcome for families who are both socially and financially excluded. Will the Chancellor indicate how the banks and not-for-profit organisations such as credit unions are going about this business? Does it not make it even more essential that the consumer credit Bill is implemented in the next few months?

Gordon Brown: I am grateful to the Chairman of the Select Committee, who has taken a big interest in this issue. Of course, he has been meeting the banks and financial institutions to look at issues of financial inclusion. The 120 million is precisely to do what he wants doneprovide better advice to people; help people escape the loan sharks and others who have been charging interest rates that are too high; and create a range of potential providers of low-interest loans and credit for people from low-income families. I hope that he will be able to work with citizens advice bureaux and other organisations, which I think will welcome this new package for financial inclusion. I thank the banks for co-operating in what is a joint effort to persuade more people to open bank accounts and get the benefits that come from having a bank account, and not to be dependent on private and sometimes unsavoury loan agencies. I shall write to him about his first point. The important point is that we welcome the work of the Select Committee on financial inclusion.

Kenneth Clarke: The Chancellor introduced the institution of pre-Budget reports. Is it really sensible to turn it into this annual ritual whereby he comes along with a string of detailed policy announcements about education, health and other domestic areas that he would like to have more charge of and produces a great deal of political rhetoric about Conservative Governments of the 1980s and about what Conservatives might do if they came into power now in order to obscure discussion of the mounting problem of the public finances, which are his principal responsibility? Does he accept that, if his critics are rightthere are now myriad criticsthat public spending is rising at an unsustainable level, that tax revenues are failing to meet his forecasts year in, year out and that public borrowing figures are getting more and more worrying as the situation deteriorates, this not only challenges his ingenuity in trying to demonstrate how he is meeting his fiscal rules but poses a very real and growing threat to the future health of the British economy, which somebody will have to deal with if he continues to be in denial about it for very much longer?

Gordon Brown: I have a great deal of respect for the former Chancellor, but I remind him of what he said in The Mail on Sunday on 21 June 1998:
	Our gloomy Chancellor is going to bust our economy without any risk of a boom coming first. I have been forecasting doom and gloom for the British economy in my column in Financial Mail for most of the past year.
	He has been predicting exactly what he said today for almost every year since 1997.
	The former Chancellor is not the only one who has come to the House to make announcements on health, education and other matters. He said that he would not have frozen public spending for the first two years, but we did, and I hope that he agrees that we have been raising public expenditure and getting it to the vital public services. He should support our policies, against Conservative Front Benchers.

Martin O'Neill: I congratulate my right hon. Friend on today's statement. Does he agree that many so-called forecasters have been mis-selling pensions and other financial services for a long time, and that they are as bad at selling as they are at forecasting? Although it is worth while and important to look towards international challenges from India and China, we have serious industrial challenges at home. He has correctly identified that those industrial challenges are not having a dramatic impact on inflation; none the less they impact on a number of businesses that depend on energy. Now that the emissions trading scheme is coming into play, will he re-examine the climate change levy, in order to reduce the burden on energy-based industries in this country and to allow businesses that are alive, well and working at the moment to survive?

Gordon Brown: I am grateful to my hon. Friend, who chairs the Trade and Industry Committee. I know that his work is part of his determination to ensure the future strength of British manufacturing industry. As he knows, we have frozen the climate change levy and look forward to the successful working of the emissions trading scheme. At the same time, he must recognise that when we introduced the climate change levy, it was part of a package agreed with business and the Government following the Marshall review. We cut national insurance for employers at the same time as we introduced the climate change levy. If we are to secure changes in both energy efficiency and the reduction of emissions, we must move forward with measures such as the climate change levy. I hope that my hon. Friend will continue to support the climate change levy, which is essential for a balanced policy for both the environment and the economy.

Peter Tapsell: When the Chancellor was calculating the figures for his statement, did he remember that when he sold more than half of this country's gold reserves, I repeatedly warned him that he was selling at the bottom of the market? Now that the price of gold has risen by about $200 an ounce, will he apologise for costing the British taxpayer some 1.5 billion by not accepting my warnings?

Gordon Brown: I do not accept that point. The previous Government, who failed to balance our reserves by making the gold sales a lot earlier, should take responsibility. It is right to have a proper balance in our reserves, which we have now achieved. The hon. Gentleman will have noticed that every other major country, apart from America, has been involved in gold sales. That includes France, which has announced gold sales in the past few months. I have always been willing to listen to the hon. Gentleman's advice, but whether it is on the Bank of England or on public expenditure, his record shows that he invariably gets things wrong.

Hugh Bayley: I congratulate the Chancellor on his long-term commitment to science and technology, on which this country's future prosperity and global competitiveness depends. Is he aware that York university now receives more research funding per academic than any other university in Britain? Will he tell us a little more about what York's designation as a science city will mean when it comes into force?

Gordon Brown: I am grateful to my hon. Friend, who has taken a huge interest in York's future economy, and I have worked with him on a number of related issues. The northern regional development agencies, One NorthEast, the Northwest Development Agency and Yorkshire Forward, have formed a partnership. As part of their new investment in technology, they are announcing today that they want to designate as science cities those cities and towns that have a cluster of scientific research and business research expertise, and a major interest, through universities and colleges, in the knowledge economy, and to invest more in their future development. That is in tune with what has been happening in the United States of America.
	The Kok report, which was published in the past few days for the European Union, recommends the creation of science and technology cities throughout the EU. The northern development agencies are leading the way. I hope that through working with them, the specific proposals for York will expand science and technology-related jobs and ensure the long-term future of my hon. Friend's local economy.

Alex Salmond: Will the Chancellor think about Scotland for a second? That would be a good idea, because burgeoning oil revenues are needed to pay for the Prime Minister's wars and the Home Secretary's identity cards. Will he explain why his boasts about the performance of the UK economy are not matched by the performance of the Scottish economy, where unemployment is significantly higher and growth is significantly lower? The Scottish economy even went into technical recession in 2001 and 2002. Who is responsible for that failure? Is it the Chancellor, or the hapless Scottish Executive?

Gordon Brown: The hon. Gentleman has predicted doom and gloom for the Scottish economy at every point since 1997. He must face up to the fact that employment, growth and living standards in Scotland are up, that more people own their homes in Scotland, that more people in Scotland are getting skills, and that more are going to universities and colleges. That is the result not of Scottish National party policy, but of the Labour Administration in the Scottish Parliament and the Labour Administration in the UK.

John McDonnell: I congratulate the Chancellor on his child care policies, which are affecting all our constituencies, and welcome their extension today. To afford those policies, it is critical to maximise our revenue income, so I ask the Chancellor to re-examine his proposal to cut 16,500 jobs within Customs and Excise and the Revenue. Individual customs officers now bring in 12.9 million per post. Surely this is not the time to cut those posts.

Gordon Brown: I respect the work of customs officers and Inland Revenue officials and pay tribute to their work securing our ports and, along with Inland Revenue inspectors and tax collectors, ensuring that revenue flows to the Exchequer. Partly because of new technology, however, David Varney's proposals to bring together the Inland Revenue and Customs and Excise will cut the gross number of jobs by 16,000. By redeploying some of the people in the Inland Revenue and Customs and Excise, the final figure will be 13,500. That decision is right, because it means that more resources will go to other front-line public services.
	I hope that my hon. Friend understands that as we expand health, education and the other public services, it is necessary, where new technology gives us the opportunity to do so, to change employment patterns. Although the Gershon proposal of 84,000 jobs is a very big number, it is a necessary means by which we can build a modern set of public services and get the resources to the front line.

Edward Leigh: Will the extra money to support local government come from health and education? In order to resolve the debate on whether, as the Institute for Fiscal Studies and the International Monetary Fund claim, a structural black hole of up to 10 billion exists, is the Chancellor prepared to commission the National Audit Office to audit his assumptions?

Gordon Brown: First, I have just explained to the Liberal shadow Chancellor why our public finances can not only sustain the public expenditure to which we are committed, but meet our fiscal rules. That is because we have cut employment and debt interest payments are substantially below their 1997 level. Because growth and rising employment are generating revenues, we can meet our public expenditure commitments and our fiscal rules. The hon. Gentleman should be satisfied that the figures that I am giving him on the future development of the economy are accurate and right. On the NAO, this Government, more than any other Government, have opened up the management and scrutiny of economic policy. However, decisions on taxation and public spending are rightly decisions for Parliament. The Government make a recommendation and Parliament decides. As for the hon. Gentleman's question about local government, we have to ensure that social services, education and health departments get the money that is necessary at the front line. That is the reason for our decisions.

Anne Campbell: As the representative of a famous science city, I warmly welcome the continuing and increased investment in science. I also welcome the Chancellor's announced intention to remove tax barriers to spin-offs, which is an important move. Has he made any assessment of what it would mean to have a 500 million cut to business support in the Department of Trade and Industry budget?

Gordon Brown: I have seen recommendations from the Conservative Opposition; one of the people on the James review said that it would not matter if research councils were abolished in their entirety. That type of thinking does huge damage not only to the future of our country but to the morale of the scientific community. I wish that we could achieve an all-party consensus on the development of science, support for the research councils and support for the innovation and technology changes for which the DTI is responsible, some of which were announced today.
	As for university spin-off companies, I hope that my hon. Friend will find that our detailed proposals solve a problem for scientists with shares in companies that are created as a result of university spin-offs. We are determined that companies that spin off from universities are given the best support possible because they, like many other companies that are starting up, are important to the long-term economic health of my hon. Friend's cityCambridgeand the economy as a whole.

David Trimble: With regard to fuel, the Chancellor mentioned fraud involving rebated oils. As he will know, in Northern Ireland that fraud puts tens of millions of pounds a year into the hands of paramilitary organisations. Could not he make that fraud much more difficult by ending the rebates and instead allowing people such as farmers to reclaim the tax on the fuel? That would not eliminate the fraud but would make it much more difficult, which might be helpful.
	Also in relation to Northern Ireland, the Chancellor will have noticed that the number of adults who are in employment there is significantly below the UK level. He said that 75 per cent. of adults were in employment, but the percentage is much lowerin the mid-60sin Northern Ireland. Is not part of the reason for that differential the fact that several of the Chancellor's measures to encourage people into work are not being fully applied in Northern Ireland? Will he consider that, especially with regard to the new measures that he mentioned?
	As for the right hon. Gentleman's very interesting ideas for children, particularly with regard to nursery schools, will he have a word with his right hon. Friend the Secretary of State for Northern Ireland to persuade him to follow the same policies there?

Gordon Brown: I am grateful to the right hon. Gentleman, and I shall be happy to meet him to talk about customs duties in Northern Ireland. We have stepped up the activities of Customs in dealing with this pernicious fraud, which has lost substantial sums of money and in some cases, as he alleged, helped forces that support terrorism.
	As for the right hon. Gentleman's point about employment, the new deal is designed to raise the level of employment, and I am happy to work with him and others to see what we can do to make it more effective in Northern Ireland. That could form part of the meeting that we have on these issues.
	As for children's services, I hope that everyone now recognises the importance that is attached, not only by the Government but by people who have looked at all these issues, to the education, care and support of the under-fives in particular. That is why we are making today's proposals.

Louise Ellman: I welcome the Chancellor's new announcements about additional support for science in the north, although I am disappointed that at this first stage Liverpool has not been designated as a science city. Can the Chancellor assure me that the high-level scientific research at Liverpool university will be supported, including its joint projects with the Daresbury laboratory?

Gordon Brown: I am grateful to my hon. Friend, who takes a huge interest in the economy of Liverpool and has been promoting several initiatives to make it stronger. I believe that Liverpool university is now the biggest single employer in Liverpool; that shows its importance to the city and its future. Liverpool is the culture city of the future and may over time become a science city as well. I am very happy to meet my hon. Friend and her colleagues to discuss what we can do to promote economic development in Liverpool in that way.

David Heathcoat-Amory: As always, the figures that the Chancellor did not talk about tell the real story about the risks to the economy. Since he has persistently underestimated the size of Government borrowing, and since tax receipts this year are coming in very much lower than his estimates at the time of the Budget, can he tell whether that is because of forecasting errors by his Department, or political interference in those estimates? Either way, will he subject to independent audit the definition of his so-called golden rule, and the reasons for those very serious forecasting errors?

Gordon Brown: That is a bit rich, given that the right hon. Gentleman was a Minister in the Conservative Government. We have opened up the auditing of public spending and revenue assumptions far more widely than they were ever prepared to do, and called in the National Audit Office to help us, which the Conservatives never did. He tells us that we must do more in this regard, yet he was not prepared to do anything.
	As for the position on revenues, the right hon. Gentleman will see in the published documents that, because of rising employment and growth in the economy, revenues from income tax and VAT have risen, and that in key areas revenues from corporation tax have risen according to forecast. We will have to consider other areas over the next few months. He will also find that, although the former shadow Chief Secretary said yesterday that the borrowing figures would be around 40 billion, if I remember him rightly, in fact they are below 35 billion, at 34 billion. The shadow Secretary of State for Work and Pensions said at the Dispatch Box yesterday that the borrowing figures would be deteriorating, but they are improving every year.

Michael Connarty: I congratulate the Chancellor on his firm stewardship and enlightened redistributive policies. I also echo his comments about the Scottish National party's continuing pessimism on the Scottish economy, given that I am sure that the hon. Member for Banff and Buchan (Mr. Salmond) shares with me the lowest unemployment in his constituency for 25 years.
	One of the problems in business start-up and development is that there is still a lack of free risk capital available to small companies. In my constituency, 50,000 has been applied for to develop an e-commerce project, and some nanotechnology projects require 3 million or 4 million. The trouble is that more money is spent on advice and bureaucrats than on freeing up risk capital for such enterprises. What might the Chancellor do to free up some of that capital for ventures that are of long-term benefit to the economy?

Gordon Brown: As my hon. Friend knows, regional venture capital funds have been set up throughout the United Kingdom. They are designed to encourage the provision of capital for new and dynamic businesses that are being created. That is a start, but there is a great deal more to do, because venture capital was previously aimed at support for management buy-outs rather than new ventures. I shall be happy to meet my hon. Friend to talk about the development of such industry in Scotlandand as for SNP Members, I think that the unemployment they are most worried about is the loss of their seats at the general election.

Michael Fallon: Will the Chancellor remind taxpayers that last time he talked about sustainable growth before the election, they were hit by an increase in national insurance contributions after the election? Will he come clean with the country and admit that all this borrowing and extra spending means that sooner or later taxes will have to go up?

Gordon Brown: Again, the hon. Gentleman, who sits on the Treasury Committee, has been predicting gloom and doom year in, year out since 1997. Does he not accept that cutting debt interest payments and unemployment, together with the high growth that has been sustained in the economy and high levels of employment, have enabled us to meet our fiscal rules and to provide the public finance necessary to deliver a high level of public services? The hon. Gentleman should be most worried about his shadow Chancellor's proposal to cut 35 billion from public spending.

Tony McWalter: My right hon. Friend knows that the Secretary of State for Work and Pensions has a genuine problem because of the 60,000 people who lost out through the idiotic Pensions Act 1995, and that 400 million has been allocated over 20 years to deal with that. Will he confirm that he has the flexibility to act if more than 60,000 people have lost out through that poor legislation? If the average loss is greater than 3,000, does he have the scope to effect appropriate compensation for those people?

Gordon Brown: It is indeed a scandal that people who lost their jobs lost their pensions at the same time. We are the first Government to take action to deal with the problems of thousands of pensioners who, as my hon. Friend rightly said, were deprived of what they had saved, and lost both jobs and pensions. As he also said, the sum set aside is 400 million. He asked whether we would review the figure. We have committed ourselves to doing that: after two or three years, we will review the arrangements. I assure my hon. Friend that the review will take place.

Michael Jack: The Chancellor will be aware of the growing sense of insecurity in many families because they know that their endowment policies will not produce enough money to repay their mortgage, or that their money purchase pension will not give them the standard of living that they expected. The only announcement on long-term savings in the Chancellor's statement referred to individual savings accounts, which are not popular. Will he review the tax treatment of endowments and money purchase pensions to ascertain whether there is a way of leaving more of the investor's money in those funds, to work harder for the needs of those who want to save and thus meet their long-term objectives?

Gordon Brown: I would take the former Treasury Minister more seriously if he had not suggested that ISAs were a failure through unpopularity. More than 16 million people have an ISA. Surely all the protestations of doom and gloom that the Conservative party made when ISAs were introduced have been proved wrong. One in five people on low incomes, instead of one in seven, have ISAs. Twice as many young people under 25 have ISAs as had TESSAs and PEPs. The right hon. Gentleman should welcome, not belittle, the success of the ISA scheme. Of course I shall examine his comments on other matters, but he should know that the Turner commission is considering the future of pensions.

Chris McCafferty: On behalf of my constituents, I warmly congratulate my right hon. Friend on his investment in families, especially the extension in child care, the coming extension in paid maternity leave and, of course, the extra money for child care. I invite him to see for himself evidence of his investment in our future, and ask him to visit the brand-new children's centre in Elland in my constituency, which is due to open in January, and witness the best practice of the local Sure Start initiative. That has already made a considerable difference to local people.

Gordon Brown: I take that as an invitation to visit my hon. Friend's constituency, and I shall be happy to do that. By 2010 there will be 3,500 children's centres. I have visited many Sure Start centres. The more that is known about their success, the more people will want to support them. I believe that, over time, we might be able to persuade even our opponents that Sure Start is a good investment. Investment made before the age of five is crucial to determining a child's future, and it is important that the country begins to recognise the value of investments such as that in my hon. Friend's constituency.

Robert Smith: Earlier, in answer to Conservative Front Benchers, the Chancellor rightly reminded the House about the disaster of the poll tax. Not only was it unfair, but it collapsed, partly because it involved an attempt to construct a register of the population, and where everyone lived, on a daily basis. Does the right hon. Gentleman recognise that many of our constituents, who are already suffering at the Government's hands through their handling of tax credits and the Child Support Agency computer system, will believe that the 5.5 billion that he is setting aside for identity cards would be better spent now on front-line security, to provide better security by having more police and better border controls?

Gordon Brown: The hon. Gentleman was giving a balanced account of eventsbefore he started speaking about tax credits. Six million families have tax credits, and many millions more children benefit from them. Instead of opposing tax credits, why does the Liberal party not start supporting them? They are the main reason why millions of people are being taken out of poverty in this country.

Several hon. Members: rose

Madam Deputy Speaker: Order. We must now move on.

Local Government Finance Settlement

Nick Raynsford: With permission, Madam Deputy Speaker, I should like to make a statement about local authority revenue finance for England in 200506.
	The settlement that I am announcing for 200506 will be the eighth successive one in which we have provided local government with grant increases above inflation. That is a real terms increase of 33 per cent. over the past eight years, which contrasts with a 7 per cent. real terms cut in the last four years of the previous Government.
	Total support from Government grant and business rates in 200506 will be 60.1 billion. That is 3.5 billion, or 6.2 per cent., more than in 200405. It contrasts with a total of just 35.9 billion in 199798, in the last settlement announced by the Conservative party. The total of 60.1 billion includes 26.7 billion of revenue support grant, 18 billion of business rates, 4.3 billion in police grant and 11.1 billion in specific grants. Of those totals, 49 billion will be distributed by formula to local authoritiesan increase of 2.6 billion, or 5.6 per cent. I shall announce the detailed allocations today.
	The figures include the extra provision to help local government meet pressures at reasonable council tax cost that my right hon. Friend the Chancellor of the Exchequer announced earlier. They demonstrate the Government's continuing commitment to both local government and council tax payers.
	I can confirm that we propose no changes in the grant distribution formulae for 200506. That is consistent with the formula freeze that we announced for three years from 200304. It provides councils with a measure of stability, which is essential for forward planning.
	I have already referred to the totals available in specific grants. They perform a valuable role in, for example, targeting funds in a way that the main formula cannot. We are bringing forward the announcement of the allocation of many of those grants to help councils plan ahead with more confidence.
	For several years, we have applied guaranteed minimum grant increasesfloorsand upper limits on grant increases, known as ceilings, to help pay for floors. Floors are well accepted. Unlike the position when the Conservative party was in power, councils are no longer faced with losing grant from one year to the next. There is no wish to do away with the floor mechanism but there has been lively debate about how the cost of the floor is to be paid.
	Let me be plain. The cost has to be found within the total of grant available, and it follows that if authorities that would otherwise receive less than the floor are to benefit from enhanced grants, the remaining authorities with larger grant increases must contribute.
	Over recent years, we have operated a system of ceilings, putting a maximum limit on grant increases, thereby ensuring that those authorities due to receive the largest increases contributed most to the cost of the floors. However, I have been impressed by the arguments put by authorities, especially in areas with rapidly growing populations, that imposing a ceiling is especially hard on them as they are never likely to receive the additional grant that a rising population, and hence rising pressure on services, would otherwise provide for them. Having said that, exempting population growth areas from ceilings would not be the best approach, as it would be bedevilled by arguments about exactly where to draw the line.
	I have therefore concluded that we should abolish the grant ceiling. Floors will be financed entirely by scaling back grant increase above the floor. All authorities above the floor will make a contribution, but none as great as the ceiling authorities used to make.
	For 200506, the grant floors will be as follows: for authorities with education and social services responsibilities, 4 per cent.; for shire district councils, 2.5 per cent.; for fire authorities, 2.5 per cent.; and for police authorities, 3.75 per cent. For the third consecutive year, every authority in England will receive an above-inflation increase on a like for like basis.
	As in previous years, we will adjust the floor scheme to provide support to authorities with increased levels of capital investment as a result of new capital allocations issued by the Government. We will also, this year, adjust the floor scheme to provide protection for councils that lose grant under the amending report for 200304.
	We will, as we did last year, ensure that every authority with education responsibilities receives an increase in its formula grant at least as large as the increase in its schools formula spending share. Again, as last year, we will expect all authorities to pass their schools FSS increase on to their schools budget other than in wholly exceptional circumstances. We have adjusted the FSS totals within the planned total to reduce the pressure of passporting and to increase growth in the environmental, protective and cultural services block, in recognition of the importance of the local services covered by it.
	We are rigorously applying the principle that, if Government policies impose new spending burdens on local government, Government will make provision to fund them.
	The Government are more than doubling our contribution to the cost of local authorities' civil protection activities from 200506. That will significantly enhance the capacity of local authorities to respond to a wide range of emergencies, whether caused by natural disasters, accidents or terrorism.
	We listen carefully to local authorities' views on the costs of implementing new initiatives and act on them where appropriate. In response to concerns expressed by local authorities on the fee levels of the new licensing scheme, my right hon. Friend the Secretary of State for Culture, Media and Sport has agreed a substantial increase in earlier estimates, and the latest proposals are now out to consultation. She has also given an undertaking that there will be an independent review 12 months after the new regime has become fully operational.
	From April 2005, authorities will be given further opportunities to increase locally raised revenue through the local authority business growth incentives scheme. That allows authorities to retain a proportion of growth in business rate revenue, with total freedom to spend this on locally determined priorities. It comes on top of the substantial additional freedoms extended to local authorities, including the prudential borrowing regime, new freedoms to trade and to charge for discretionary services, and continued reduction in ring-fencing in 200506, which will see ring-fenced grants fall to below 9 per cent. as a proportion of overall Government grant, which is even better than I promised last year.
	A number of councils have expressed concerns that they are facing a substantial increase in pension contributions. We have listened to their concerns, agreed to amend regulations to ease certain pressures and issued advice to enable them to manage the outcome of the 2004 actuarial revaluation in the most effective way over the next three years.
	In common with the rest of the public sector, councils need to be remorseless in the pursuit of efficiency. Following the Gershon review, the Government have set a target across the whole of the public sector to deliver more than 20 billion of efficiency gains a year by 200708. Local government is expected to contribute significantly to that, delivering at least 6.45 billion of efficiency gains. However, we believe that higher gains are attainable by local authorities, and Departments will work in partnership with them to help to achieve maximum efficiencies. This is a win-win scenario, as efficiency gains will be retained locally and can be used for reinvestment in front-line services.
	With substantial additional funding, real scope for efficiency gains and the additional flexibilities that I have outlined for councils, there is no excuse for authorities to set excessive increases in council tax. The average increase in council tax in 200405 was 5.9 per cent. Although that was less than half the previous year's increase, and the lowest in almost a decade, there is still considerable scope for authorities to do better. We expect to see substantially lower increases next year, with a national average increase of less than 5 per cent.
	The Government used our reserve capping powers for the first time this year to deal with excessive increases. We will continue to use those powers to ensure that council tax payers do not face unacceptable increases. We are prepared to take even tougher action in 200506. That applies to all authorities, including police and fire authorities.
	We will continue to support local authorities in promoting take-up of council tax benefit. We are including information about the benefit in this year's winter fuel payment letters, which go out to about 8 million households, and we are following that up with regional and national press advertising. We will also encourage local authorities to include clear information about council tax benefit with council tax bills and, where appropriate, a simple coupon to return indicating a wish to claim benefit. Looking ahead, my colleagues in the Department for Work and Pensions are developing proposals to streamline the claims process for pensioners when more than one benefit is claimed, so that they do not have to provide the same information twice.
	As my right hon. Friend the Chancellor of the Exchequer has announced today, the Government will repeat next year our help for pensioners aged 70 or older, by giving them a 50 payment to help them with their council tax bills. The amount reflects the fact that we expect a substantially lower average increase in council tax next year.
	The Government have demonstrated our continued commitment to local government. We have increased investment year on year: 24.2 billion since 199798, and a further 3.5 billion this year. We have ensured once again that every council has an above-average increase in formula grant. We have given councils more opportunity and flexibility to raise and deploy local resources to meet their priority needs. In return, we expect, and all taxpayers expect, that local government will continue to deliver improving services at an affordable cost. If they do not, we are prepared to take tougher capping action. I commend the settlement to the House.

Eric Pickles: I thank the right hon. Gentleman for early sight of his statement and the accompanying documents. Such release of information is entirely typical of him, and it makes for much better debate.
	Over the past four weeks, I have been due to share a platform with the right hon. Gentleman or other Ministers on no less than three occasions. Each time, the relevant Minister has cried off at the last minute, because of some reversal of the Government's fortunes, much to the disappointment of the audience and myself. Given the nature of the Chancellor's financial allocation to local government, I am sure that the whole House will share my relief in finding the Minister in his customary place today. Who would have blamed him if he had decided to absent himself? Indeed, the Deputy Prime Minister has sought to create as much physical distance as possible between himself and today's statement by travelling to China. That seems a little excessive, but it is no doubt a comfort to the great man.
	This statement is nothing more than a poor attempt to paper over the cracks of a crumbling council tax policy, a fiddled financial settlement and an abandoned balance of funding strategy. It is a dawn raid masquerading as a strategy. So ill thought-out are the measures that they have provoked a senior Government official, in the pages of today's Financial Times, to use a four-letter word to describe the measures, and pejoratively to invite the Government to depart. I am sure that that anonymous mandarin, in both his choice of words and his sentiment, speaks for the whole nationin spades.
	The record clearly shows that the Opposition have been more accurate in predicting levels of council tax than the Government. The Government's winter boasts are soon drowned out by April misery for the taxpayer. I have with me a full list of the Labour Government's predictions on the adequacy of the settlement, and the folly that they produced. I shall let just one speak for the many. Last year, on the settlement, the Minister said:
	We have provided a good settlement, on the basis of which local authorities can plan for future improvements in services without unreasonable increases in council tax. [Official Report, House of Commons, 19 November 2003; Vol. 413, c. 789.]
	That settlement did not even have to wait until the spring to be proved inadequate. In a few short weeks, the Chancellor had to bung in an extra 340 million. What is the status of that 340 million? Has it been carried forward to next year? If so, given that 350 million relates to ring-fencing, the Chancellor's 1 billion bung begins to look very smallit begins to look like about 250 million.
	Last year, because of the Government's insistence on passing on increases to schoolswhich they are repeating this year14 local authorities were left with no additional money for their other services. Will that be repeated next year, and how many councils will be affected? The Minister can talk all he likes about floors and ceilings, but he cannot hide the fact that under his Government council tax has gone through the roof. Further unbearable increases are in the pipeline as a direct result of this settlement.
	In its small print, the July review predicted that the locally financed council tax element of local government would increase from 18.6 billion in 2004 to 19.8 billion. That represents an increase of 6.7 per cent., or three times the rate of inflation. Will the Minister confirm that on page 209 of the Chancellor's pre-Budget report, issued today, council tax receipts are projected to soar by 1.6 billion? Will he confirm that page 23 forecasts inflation at 1.75 per cent.? We are looking at an increase in council tax receipts over four times the rate of inflation.
	The change in council tax receipts clearly mirrors the increase in council tax demand. Since 1997, receipts have risen by 80 per cent., and in England council tax has risen by 70 per cent. The figures clearly marry.
	The settlement does not seem to recognise the unavoidable pressure on local authorities. The Local Government Association has measured it at about 1 billion. Let us examine three pressure areas. The Minister referred to certain pressures on pensions. His solution is to try and put it off for a couple of years, but how are local authorities to manage with pension costs due to rise next year by an extra 300 million and the year after by an extra 900 million? Pressure from the growth in waste levels, waste taxation and waste legislation will cause costs to escalate from 225 million this year to 480 million next year.
	Do the Government really want Hampshire to raise council tax by 4 million, Devon by 4.4 million or Tandridge by 2.2 per cent.? Perhaps they do, as much of the money will go straight back to them.
	There will also be more children receiving social care. The Children Act 2004 places additional burdens on authorities. Why are the Government not making adequate plans to meet the growth in children's services with an increase from 94 million next year to 587 million in 2007?
	Local government leaders have long argued that the retail prices index is an inappropriate measure to gauge local costs. On 24 June, the Local Government Association met the Chief Secretary to the Treasury, who agreed to start work on a price index for local government. What progress has been made so far?
	Then there is the question of the census. The amending revenue support grant report for 200304 was published on 18 November, but the issuing of the report for 200405 has been postponed until next year to ensure that all possible revisions of the data used in the 200405 settlement will be included.
	The House will rejoice at the recognition of the disservice done to the Manchester and the restoration of its missing citizens. They will receive an extra 7.8 million. Other areas are less fortunate, however. Worcestershire will lose 1 million, and Norfolk nearly 500,000. The South Yorkshire police authority will lose nearly 1 million. Worst of all, Surrey will lose 2.3 million. On 25 November, the leader of its county council wrote this to the Minister:
	Under your proposals, Surrey stands to lose 2.23 million in respect of 200304, a greater loss than any other council in the country . . . Why should the people of Surrey pay for a mistake made by central Government?
	The hon. Member for Manchester, Blackley (Mr. Stringer) put it more robustly when he suggested earlier this year that the national statistician could not count up to 60 million.
	What justification can there be for asking council tax payers to pick up the tab for central Government's own blunders? Every year Labour promises a generous funding settlement for local councils, yet every year under this Government council tax has soared by three times the rate of inflation. This year the average council tax bill in England is over 1,000, an increase of 70 per cent. or almost 500 since Labour came into office. That is equivalent to almost 100 a month from people's take-home pay or pensions.
	The reason is simple: the Government have chosen to use the council tax for a purpose for which it was never intended. They have transferred burdens and duties to local authorities without resources. The council tax has become their stealth tax of choice.
	The Minister knows that what he has announced today will store up massive council tax increases for the future. His strategy for the council tax is now in tatters; all that remains is for the electorate finally to bury it in May.

Nick Raynsford: It was interesting that the hon. Gentleman managed to keep a straight face during some of his remarks. He remembers what life was like when his party was in government. He remembers the settlements that Conservative Members announced from this side of the Chamber. Those settlements did not give grant increases to local government; in some years they actually cut grant, and in no year did they match inflation. I do not know how he has the cheek to attack a Government who have provided huge increases.
	Let me remind the hon. Gentleman of the figures. In the 199798 settlement, the last that his party presented to the House, 35.9 billion was given to local government. This year's total is 60.1 billion. That is thanks to a Government who have been increasing funding, supporting local government and listening to local government, and who are taking action to tackle the problem of authoritiesand some Tory authorities have a poor reputation in this regardthat are charging too much council tax. We have made it very clear that we will use tough capping powers to deal with authorities that increase council tax unduly.
	Last year, Labour authorities increased council tax by 4.7 per cent., Tory authorities by 5.4 per cent. and Liberal Democrat authoritiesI concede to the hon. Gentleman that their record is the worstby 6 per cent. If Tory and Liberal Democrat councils had matched the performance of Labour councils, council tax increases last year would not have been 5.9 per cent.: they would have been below 5 per cent., a target that I would expect most sensible people to endorse.
	The hon. Gentleman did not have the gall to admit that his own county of Essex is looking forward to an extremely good settlementa 6 per cent. increase in its grant in the coming year. I am sure that when he talks to Lord Hanningfield, he will be able to discuss all the things that Essex county council will now be able to do thanks to the generosity of a Labour Government. That is nothing like what the council experienced under a Conservative Government.
	The hon. Gentleman asked about the status of last year's 340 million increase by the Chancellor. It should be seen in the context of our 3.5 billion increase in total spending in the current year: that is 3.5 billion, not 340 million.
	The hon. Gentleman asked a very interesting question about the consequences that would appear in next year's settlement. I think that most Members expect a general election between now and then. It was interesting to note his tacit concession that his party did not have a prayerthat it did not have a chance of winning the election, and expected to remain in opposition with no influence on next year's settlement. I must tell him that his party, were it to come to office, would not offer a 3.5 billion increase. It has said quite openly, and the shadow Chancellor has said it repeatedly, that it would freeze local government expenditure. That would be a recipe first for cuts in services, and secondly for massive council tax increases. That is what the Conservative party stands for.
	The 6.7 per cent. figure that the hon. Gentleman citedprobably not he but his researchers had delved into the more obscure aspects of the Red Book and other documentsfails to take account of the increase in council tax, so in any case it is not an accurate projection, but if he were to redo it on the basis of today's settlement, the figure would be 3.6 per cent. The Red Book is a reflection of historical patterns of council tax increases, and as further reductions in council tax levels occur as a result of this settlement, we will see a further reduction in the projection.
	On pensions, we have already taken action to ease pressures in the coming year, and as the hon. Gentleman should surely be aware, we are already consulting on longer-term changes to enable local government to meet its responsibilities under the local government pension scheme, while at the same time not facing unreasonable costs.
	On pressures on social care, the hon. Gentleman obviously has not looked at the details. Otherwise, he would know that the children's services that he claims we are underfunding will receive a 7.6 per cent. increase in resources in the coming year, which is well above the average.
	I remind the hon. Gentleman that local government asked us to do an amending report if it turned out that the census figures had to be adjusted, and that Conservative authorities such as Westminster were in the forefront of asking for such a report. Local government knows that such a report does not put in additional money; it simply amends a previous settlement in the light of changed figures, so if authorities such as Manchester deserve an increase because former census projections underestimated their population levels, it is of course right and proper that there be an amending report, which means that there must be an adjustment for everyone. That is the inevitable consequence, and that is what local government as a whole asked us to do.
	Finally, although the hon. Gentleman did the best job that he possibly could in the circumstances, he knows in his heart that this is a good settlement for local government, which provides the basis for local authorities to continue to deliver improved services with no need for large council tax increases.

Several hon. Members: rose

Madam Deputy Speaker: Order. We have other business before the House later today, so may I ask Members to be brief in their questions and responses?

Edward Davey: I thank the Minister for the statement, but I hope that his answers now will shed rather more light on what is actually planned. He suggested that there was new money for councils and for police and fire authorities, so that they can keep council tax down, but is it not true that, far from there being significant new money from the Treasury, most of this cash is coming from cuts elsewhere? Will he now list the cuts being made to fund this attempt to massage council tax downwards before the election?
	Is it not true that Departments from education to environment are the losers? For example, is it not true that cash has been found by reducing recycling? Every year we see a last-minute attempt by Ministers to patch the council tax problem. Does that not show a Government in permanent crisis over the unfair council tax? When will they act for the long term, scrap council tax and stop resorting to short-term panic measures?
	The Minister will doubtless claim that the extra money is not a pre-election fix. If so, can he confirm that it is permanent and not a repeat of last year's one-off grant? Does he accept that, even if Ministers succeed in manipulating council tax rises lower than last year's, such rises are likely to be higher than inflation? Can he confirm that an average council tax increase of 5 per cent. will be nearly four times the inflation rate used today by the Chancellor? If so, what will he say to pensioners on fixed incomes whose pensions go up only by the rate of inflation? Can he confirm that all pensioners' council tax bills will rise by 50 a year at the very least? Will he also admit that by forcing councils into one-off raids of reserves and into putting off resolving issues such as pension liabilities, Ministers are merely scheduling a massive council tax rise for after the election? Is this not the calm before the storm?
	The Government know that the council tax system is in a mess; they wasted 15 months on the balance of funding review just to confirm that fact. Now, they have asked Sir Michael Lyons to sort out that mess, but by December next yearafter the election. Why, then, will the Minister not admit that this statement and the Lyons review are simply stop-gap holding measures to get Ministers through the election before they tell us what they really thinkif they win?
	We have heard today that the Government plan to reform council tax benefit to increase take-up, but do they really expect the House to believe that an advertising campaign will make any significant difference? Some 40 per cent. of pensioners fail to claim the Government's pension credit, even though many millions have been spent on advertising it. Does the Minister really believe that council tax benefit take-up will be any better than that for the pension credit?
	Will the Minister also explain why county councils in particular are being hit by this settlement? Why did he take the perverse decision to use 1991 census data for the 200506 grant? He knows that using 13-year-old data cost the counties more than 100 million, thereby adding 2 per cent. to their council tax bills. Why has he done that?
	On the police settlement, of which we do not know the full details, does the Minister realise that pressure on police authorities from the rising pension bill is likely to make that settlement at best a standstill, and for authorities on the floor, a recipe for front-line cuts? Given the priority of law and order, can he not ensure that police authorities know his capping criteria in advance?
	Can the Minister also explain why he continues to favour businesses over pensioners? He has given businesses certainty in respect of the revaluation of non-domestic rates by capping increases. Why has he made no such commitment to fairness in the forthcoming council tax revaluation? Is it not true that lurking behind this statement is the huge threat of council tax revaluation? Why do the Government refuse to say how such revaluation will work before the election? Does the Welsh experience not show that millions of taxpayers will experience massive rises in their council tax bills if revaluation goes ahead?
	This is a pay now, pay more later settlement. Ministers have put off difficult decisions and are hoping for calm before a post-election storm, yet the council tax is so unfair that the storm is closing fast.

Nick Raynsford: I have to laugh at the Liberal Democrats' efforts to present this as a bad settlement.
	The hon. Gentleman asked a perfectly fair question about the extra money. Some 637 million of additional money has been secured through discussion with the relevant Departments, all of which have an interest in good local government delivering services, be they health or education services, as my right hon. Friend the Chancellor rightly emphasised. There has been a cross-Government response to ensure that local government has the means to deliver the services that are needed, without an adverse impact on council tax. I would have expected him to welcome the additional moneytotalling approximately 1 billionand measures to ease pressures on local government.
	The hon. Gentleman asked a number of specific questions. He said that the council tax is unfair and asked why we are not scrapping it. The Liberal Democrats are extraordinary on council tax. Their proposal would inevitably produce a massive increase in bureaucracy. They want separate local income tax rates for each local authority in the country, which would entail not only a huge increase in bureaucracy but huge pressure on the Inland Revenue. The document in which they announced that proposal also states that in order to make savings,
	we will scale back the running costs of the Inland Revenue by . . . reducing the number of local tax offices.
	Their own left hand does not know what the right is doing. That shows the attention that we should give to their entirely unconvincing approach to local income tax.
	The hon. Gentleman clearly did not listen to what I said about measures to ensure that pensioners receive the help to which they are entitled. My colleagues in the Department for Work and Pensions are looking at specific ways of simplifying the process through which pensioners receive the benefit, in order to avoid the need for duplicate claims.
	The hon. Gentleman says that the county councils will be hit, but he clearly has not looked at the figures. How is it, therefore, that Cambridgeshire is receiving an increase of more than 11 per cent., and Wiltshire a 9.4 per cent. increase? Such huge increases would have been unthinkable when the Conservatives were in government. Why does he not talk to his colleagues in Milton Keynes? Its Liberal Democrat-controlled authority is receiving a grant increase of more than 11 per cent. because of this Labour Government. He ought to give some credit where credit is due.
	The hon. Gentleman asked about the settlement for police authorities. He will know that, as always on these occasions, it is announced separately by my colleagues in the Home Office.
	On capping, we made it clear that we will apply capping principles across all groups of authorities and that there will be no exceptions.
	The hon. Gentleman's final point was about revaluation and I must tell him that he should not draw any conclusions from the Welsh example, because it was decided in Wales to add an additional band at the top, but not at the bottom. Inevitably, that influenced the outcome in respect of the revaluation. There is no question of any commitment to a revaluation on that basis in England, so the hon. Gentleman should draw no conclusions whatever from what happened in Wales.

Andrew Bennett: I congratulate my right hon. Friend on securing a very good settlement indeed. I also congratulate him on the 50 for pensioners and on the take-up campaign that will be run. Will he recognise, however, that many pensioners had difficulty paying this year's bills, as they are cash-poor while being capital-rich? Is it not time that we put in place in this country an equity release scheme to enable pensioners, who in many cases have seen huge increases in the value of their properties, to free up some of that money to pay their council tax bills?

Nick Raynsford: First, I thank my hon. Friend, the well known and experienced Chairman of the Select Committee who knows a great deal about these issues, for his kind comments on the settlement. He has better experience of what a good, as against a bad, settlement is. He will be pleased to know that his own authorities, Stockport and Tameside, are receiving grants increases of 5 and 4.9 per cent. respectively.
	My hon. Friend asked about the position of pensioners who are capital-rich but asset-poor. He raises an important issue, which I know is being looked into carefully by the Lyons review. Sir Michael Lyons is an expert in this field and we believe that it is right for the complex issues of local government finance to be considered very carefully before decisions are taken. I have the utmost confidence in Sir Michael Lyons and his ability to produce sensible suggestions to tackle the real problem that my hon. Friend has identified.

Alistair Burt: Does the Minister realise that constituents will see the Government's further attempts to provide specific moneys to relieve council tax pressure at the expense of cuts in health and education as underpinned by a sense of guilt for the pressures they have placed on counties such as Bedfordshire? In recent years, that county council has suffered from extra costs, increased burdens from Government pressures, the transfer of moneys away from the shire counties to other places and problems stemming from the inability to use appropriate census data. Does the Minister not expect constituents to recognise cheats when they see them?

Nick Raynsford: I would expect the hon. Gentleman to recognise that his own county of Bedfordshire has received a 6.5 per cent. increase[Interruption.] I would also suggest that the hon. Gentleman moderates his language in future[Interruption.]

Madam Deputy Speaker: Order. The hon. Member for North-East Bedfordshire (Alistair Burt) might want to rethink his statement.

Alistair Burt: I would not want to apply that statement to any Government Members, Madam Deputy Speaker. I was referring to the process by which this extra payment has been arrived atthrough cuts in other budgetsand I stand by what I said earlier.

Nick Raynsford: I regret, Madam Deputy Speaker, that the hon. Gentleman has not seen fit to withdraw an allegation that is wholly unfounded and does no justice to a settlement that has given his county a 6.5 per cent. grant increase. Most balanced Members of Parliament would acknowledge and recognise that. I tell the hon. Gentleman as I have told others that the Government have discussed the best ways to ensure that local government is properly financed in the years ahead and, more particularly, for the year 200506. We have done so on the basis of ensuring additional funding for local government, but without the threatened cuts that the hon. Gentleman talks about in other service areas. This is all about improving the delivery of services by local government, which impacts on all Government Departmentsparticularly the Department for Education and Skills and the Department of Health, because we hold education and social services very dear indeed.

Bill O'Brien: I congratulate my right hon. Friend on his continuing support for local government. I would like to draw to his attention two sectors where pressures can be felt. The first is environmental protection and cultural services, for which the recycling of material and waste management are important and the second is health and social care. Local government is looking for additional support in those respects and I hope that my right hon. Friend will continue to give his support to those units. Will he also take note of police service demands for additional funding to meet their commitments?

Nick Raynsford: My hon. Friend has taken a close and long-term interest in local government funding and particularly advocated the interests of the special interest group of municipal authorities. I am sure that he will be pleased to know that his own authority of Wakefield receives a 5.5 per cent. grant increase in this settlement. He asked about the EPCS settlement, which I know has been a matter of concern to many authorities. He will be pleased to know that, as a result of our work, we have increased the formula funding share provision for the EPCS block from 11.1 billion last year to 11.385 billion in the settlement for 200506a 2.5 per cent. increase, which is much better than previously anticipated on the basis of the original spending review. We certainly recognise the importance of the EPCS block and the need for continuing investment in the matter of liveability.

Robert Walter: One of the major concerns of the two district councils in my constituency is the burden placed on them by central Government when they have to deliver certain services, but the Government do not provide them with enough money. The Minister mentioned the Licensing Act 2003, in respect of which the fee income will probably lead to a major shortfall. East Dorset district council recently raised with me the access to information policy, whereby it can recover only 10 per cent. of the cost of the information that it provides. The disabled facilities grant is another problem. The Government office for the south-west has made a blanket 2 per cent. cut this year and the council might also lose more than 100,000 in respect of the planning delivery grant. Can the Minister reassure council tax payers in my constituency that they will not be burdened with yet more Government expenditure in the name of the local authority?

Nick Raynsford: Yes, I can. The hon. Gentleman raised four issues. On freedom of information, the Local Government Association suggested in its initial submission that there would be an extra cost to local government of 125 million. When we analysed the figures with the association, it transpired that it was talking about the total cost to the whole public sector and the actual cost to local government is very much less. Following discussions between my colleagues in the Department for Constitutional Affairs and the LGA, the actual cost to local government was agreed at well below 20 million. That is the informed decision about the actual burden and it is provided for in the settlement that I have announced today.
	I have already referred to the significant increase in licensing fees, which are currently the subject of consultation, and to the pledge by my right hon. Friend the Secretary of State for Culture, Media and Sport that there will be an independent review in any case, after the first year of the scheme. On disabled facilities grants, the hon. Gentleman will know that they have increased enormously during the past eight years. The level of grant has almost doubled over that time.
	On planning delivery grants and planning fees, when the hon. Gentleman looks at the fine detail, he will realise that the Government are acting to make it easier for local authorities to deliver a good quality service and to receive support where they achieve the higher performance targets. The fees will also allow them to recover their costs, whereas there has been genuine concern in the past that that was not possible. On all the hon. Gentleman's points, there is a good news story and I hope that he will welcome his authority's 6.1 per cent. grant increase. Local government in Dorset will want to do its very best with the good settlement that it has received.

Tony Clarke: I listened carefully to my right hon. Friend's statement and he said that he had listened carefully and had been impressed by the arguments of authorities in areas with rapidly growing populations. Can he reconcile those comments with the fact that Northampton borough council, the largest district council in England and the town of his birth, has a settlement of 2.7 per cent.just above the floor? Why then should I support his proposals? Why should I not object to his Department's proposals for an urban development corporation in that area, and why should not Northampton borough council withdraw its support on the same basis?

Nick Raynsford: My hon. Friend will know that the settlement has given South Northamptonshire a significant increase of 8.3 per cent. as against the 2.7 per cent. increase for Northampton itself. That will reflect changes in demography and population, and it is right that those changes are taken into account. The position of all district councils is protected with a 2.5 per cent. floor so that all district councils have the means to deliver services with a settlement that is above the rate of inflation. My hon. Friend will no doubt want to welcome the fact that Northamptonshire county council has a 6.1 per cent. increase, which is a very good increase indeed.

Nick Gibb: Is the Minister aware that in my constituency, which has one of the highest proportions of retired people, many pensioners are already finding the level of council tax unsustainable and many are forced to eat into their capital to pay it? What is contained in the announcement today that will result in a reduction in the council tax for the thousands of pensioners in Bognor Regis and Littlehampton who may not qualify for benefits but still cannot afford the tax even at its current rate and even with the promised 50 voucher?

Nick Raynsford: I would have hoped that the hon. Gentleman had heard when he was listening to the earlier exchanges that decisions on council tax are taken by local authorities. Conservative authorities do not have a universally good record on that. We have seen higher average council tax increases from Conservative authorities than Labour authorities. Only the profligate Liberal Democrats exceed Conservative authorities in a tendency to push up council tax.
	The settlement gives a good increase to all local authorities. They all have an above-inflation increase. The hon. Gentleman will have heard my comments to the hon. Member for North Dorset (Mr. Walter), who asked about action to tackle pressures on local government. This settlement involves not just increased funding for local government, but a series of measures designed to tackle the genuine pressures that local authorities face. In return, we expect authorities to budget prudently for low increases in council tax. We expect increases to be lower in the coming year than last year and to be below 5 per cent. in aggregate across the country.

Clive Betts: I welcome the settlement that my right hon. Friend has announced, especially the 1 billion extra, which was precisely the figure that the now Conservative-led Local Government Association was asking for today. Will my right hon. Friend give me an assurance that if authorities such as mine in Sheffield can show in due course that they had substantial under-recording of the population on the census, as Manchester has proved, it will receive an increase in grant to reflect that fact?

Nick Raynsford: I thank my hon. Friend for his kind remarks about the impact of the settlement and the fact that it meets the concerns that have been voiced by local government about the adequacy of what was expected before it was announced. As for the census, we can make only one amending report for any year. There is no question of reopening the 200304 settlement. We are still looking at the position in respect of 200405. It has always been our position that if the Office for National Statistics makes adjustments to population figures we are prepared to reflect them in the settlement so that authorities who have had their population under-enumerated can receive compensation.

Patrick Cormack: Why does this genial and generally affable Minister not deliver a statement that the council tax payers of South Staffordshire and every other district in the country can understand? Why do we have this jargon-led nonsense of pressure of passporting, prudential borrowing regime, ring-fencing and the ghastly win-win scenario? Why does the Minister not speak English so that the people of this country can understand what he is saying?

Nick Raynsford: If I may say to the genial gentleman, for whom I have a great deal of respect, his councils are in a win-win situation. South Staffordshire, in which I know that he takes a close interest, has a 9.6 per cent. increase in grant and Staffordshire county council a 5.3 per cent. increase. That is surely a cause for congratulation. I apologise to the hon. Gentleman that the technicalities of local government finance are such that a number of concepts such as floors, ceilings and passports are now common currency. I think that the hon. Gentleman will find that most of his local authority officials are familiar with that language. I hope that he will forgive me for using language which is relatively familiar in local government circles.

Judy Mallaber: The Conservative Leader of Amber Valley borough council has urged me to lobby Ministers about what he predicted would be a mere 0.66 per cent increase in funding. As I do not have the figures yet, can my hon. Friend reassure me that the increases for Amber Valley and Erewash, of which I also represent part, are far higher than that and that they follow increases for the past four years for Amber Valley of 6.5 per cent., 5.8 per cent., 12.5 per cent. and 3.7 per cent.? That contrasts with the projected cash freeze for two years that the shadow Chancellor proposes.

Nick Raynsford: My hon. Friend makes a valid point. I am happy to give her that assurance. I am pleased to say that the percentage increase for the coming year for the three authorities in which she has an interest are 4.4 per cent. for Amber Valley, 6.9 per cent. for Erewash and 5.8 per cent. for Derbyshire county council. All those authorities will receive good increases that build on the good settlements in previous years.

Simon Hughes: May we take it that the legislative programme in the Queen's Speech means that the Government have no plans before the general election to change the method of collecting money in local government and that they continue to plan to go ahead with a revaluation of properties in England? What will the average effect on council tax bills be in Greater London and the south-east of England of that revaluation of property values?

Nick Raynsford: I note that the hon. Gentleman wants to score points rather than show an interest in what the settlement means for his authority. Before I respond to his question, may I remind him of a point that he has chosen to ignore? Southwark council, with a Liberal Democrat leadership, receives a 7 per cent. increase in grant? I would have thought that he would at least acknowledge that the Government are doing well for his local authority. I am sure that the council tax payers in Southwark will be pleased to know that the Labour Government are supporting the area with a generous settlement.
	The hon. Gentleman will know that local government finance is the subject of the Lyons inquiry. As I have made clear, we do not intend to make hasty decisions about complex issues. In the past, ill-thought-out and hasty decisions such as the introduction of the poll tax caused enormous difficulty. We will not make the mistake of rushing the implementation of ill-thought-out proposals such as local income tax, to which the hon. Gentleman's party is wedded and which would cause administrative chaos and have serious consequences for distribution. We will be careful to ensure that there is not the upheaval that would flow from the Liberal Democrats' proposals.

Adrian Bailey: I thank my right hon. Friend the Minister for his statement. I welcome it and thank him for what appears to be a generous settlement for my borough of Sandwell. As the former finance chief of Sandwell under a Conservative Government, I can tell my right hon. Friend that I would have preferred to have to deal with the problem of real-terms growth under a Labour Government than with the real-terms cut that I had to deal with under the Conservative Government. Sandwell has historically been under-funded, so I welcome the removal of the ceilings in the grant.
	My right hon. Friend will also be aware that there is an issue with the police grant. While I accept that the announcement of that grant will be made by the Home Office, can he reassure us that the same constructive principles that have underpinned this settlement are being actively considered by the Home Office for the west midlands police? We have had a win in Sandwell; we would like a win for the police and a true win-win situation.

Nick Raynsford: I am happy to confirm that it is a win-win situation. Sandwell council receives an increase of 6.3 per cent. in its grant, which will enable it to continue to do good work while keeping the council tax down. I congratulate Sandwell on a low increase in council tax last year of just 1.9 per cent. Many other Labour councils secured low increases. I hope that other local authorities of different political persuasions will follow the good example set by Sandwell last year.
	The police general grant will increase by about 4.8 per cent. and, with specific grants added on top, the total increase will be 5.1 per cent. So there is good funding for the police and for Sandwell council.

George Young: In recent weeks, Members on both sides of the House have told the Government that had they stuck with the indicative level of grant, council tax increases would have been unacceptable, and I welcome the fact that they have listened to those representations. Can the Minister shed some light on the third of a billion pounds for local government to which the Chancellor referred two hours ago? Can he confirm that that is not new money but simply the lifting of the ring fence from existing grants?

Nick Raynsford: I can tell the right hon. Gentleman a little more about that and, as a former Minister who has carried these responsibilities, he will understand that, inevitably, there is a complex pattern of increased fundingsome 637 million of increased funding has been providedand measures to ease pressures. The areas in which pressures have been eased include pensions, which I have highlighted; the passporting obligation in relation to schools funding; the issue of waste management; and other similar issues. We have also introduced measures to enable local authorities to recover more of the costs of delivering certain services, such as planning fees, fees for the licensing function and the other points that the hon. Member for North Dorset (Mr. Walter) raised. It is a combination of those three elements that together ensure that the overall burden on local government has been eased by around 1 billion, which entirely meets the concerns expressed by local government that action should be taken to ease the pressures and enable authorities, in return, to make low council tax increases. I sincerely hope that they will keep their part of the bargain.

Hugh Bayley: Earlier today the Chancellor said in his pre-Budget report that inflation was running at 1.25 per cent. Given that a floor of 4 per cent. has been established for unitary authorities such as the City of York, it is clear that the Government are giving substantially more than inflation to local authorities. Will my right hon. Friend confirm the precise amount that the City of York will receive as an increase and state that there can be no possible excuse this year for the council to put an inflation-busting 8.5 per cent. on the council tax? On the expenditure side, does my right hon. Friend accept that there are particular cost pressures in places such as York because of its boom economy, which brings high salaries and high house prices? In the period between now and the review of the formula, those pressures need to be examined very closely by his Department through the area cost adjustment.

Nick Raynsford: My hon. Friend makes a very good point. His local authority will receive a good increase of 5.1 per cent. and I hope that it will budget prudently. He reminds the House of the authority's record last year, when it came close to falling within the capping regime with an increase of 8.5 per cent. I hope that it will do better in the coming year, because it behoves all authoritiesespecially Liberal Democrat-controlled ones, which have the worst record on high council tax increasesto be much more careful in the future and to budget prudently in the interest of council tax payers, who are not amused by the unreasonably large increases that they have had to meet in the past.

Alan Beith: What is the main reason for the fact that the four predominantly rural districts in Northumberland have increases at or only just above the floor level, as some of them have had for year after year?

Nick Raynsford: The right hon. Gentleman raises a fair question, but as we have just published the figures today I will need to look further at them to give him a precise explanation. The three rural Northumberland districts that he represents have increases of 2.7, 2.5 and 2.9 per cent., which are all above inflation and are not bad settlements by comparison with those in the past. I will have to look in detail at the explanation, which may be connected to demographic factors, as is often the case. He will also know that Northumberland county council has a good increase of 5.7 per cent. and I am sure that it will be able to operate well with that and set a low council tax increase.

Business of the House

Peter Hain: The business for next week will be as follows:
	Monday 6 DecemberSecond Reading of the Railways Bill.
	Tuesday 7 DecemberSecond Reading of the Serious Organised Crime and Police Bill.
	Wednesday 8 DecemberSecond Reading of the Commissioners for Revenue and Customs Bill.
	Thursday 9 DecemberEstimates [1st Allotted Day]. There will be a debate on management of information technology projects: making IT deliver for DWP customers, followed by a debate on secondary education: Diversity of Provision and Secondary Education: School Admissions. Details will be given in the Official Report.
	At 6pm the House will be asked to agree all outstanding estimates.
	Friday 10 DecemberThe House will not be sitting.
	The provisional business for the following week will be:
	Monday 13 DecemberOpposition Day [1st Allotted Day]. There will be a debate on an Opposition motion. Subject to be announced, followed by Proceedings on the Consolidated Fund Bill.
	Tuesday 14 DecemberRemaining stages of the Mental Capacity Bill.
	Wednesday 15 DecemberA debate on European Affairs on a motion for the Adjournment of the House.
	Thursday 16 DecemberRemaining stages of the School Transport Bill.
	Friday 17 DecemberThe House will not be sitting.
	The House may wish to be reminded that we will rise for the Christmas recess at the end of business on Tuesday 21 December and return on Monday 10 January.
	I should like to inform the House that the business in Westminster Hall will be:
	Thursday 9 DecemberA debate on the report from the Treasury Committee on restoring confidence in long-term savings.
	Thursday 16 DecemberA debate on the twenty-sixth annual report from the House of Commons Commission.
	Following are the details:
	The 3rd report of Work and Pensions Committee, Session 200304 (HC311) and the Government's response to the 3rd report into Management of Information Technology Projects (2nd special report of Work and Pensions Committee, Session 200304) (HC1125)).
	The 4th report of Education and Skills Committee, Session 200203 (HC94) and Government response to Secondary Education: Diversity of Provision (4th special report of the Education and Skills Committee, Session 200203 (HC1096)); and Secondary Education: School Admissions (4th report of Education and Skills Committee, Session 200304) (HC58)
	The list of estimates to be agreed are as follows:
	Vote on account for House of Commons 200506 (HC1236); Vote on account for National Audit Office 200506 (HC1237); Vote on account for Electoral Commission 200506 (HC1238); Vote on account 200506 (HC16); Winter supplementary estimates and new estimates 200405 (HC1234)

Oliver Heald: Although I thank the Leader of the House for the debate on European affairs, he will know that I have asked for a general foreign affairs debate to allow us to discuss the situation in Africa and the middle east. When may we have such a debate?
	We all hope that an agreement will be reached in Northern Ireland. If so, can the Leader of the House assure us that there will be a full oral statement made to the House at the first available opportunity?
	Turning to the accountability of Ministers, the Committee on Standards in Public Life recommended that the Opposition should be consulted about those conducting investigations into ministerial conduct. Why have the Government refused to consult the Opposition on that issue? May we have a debate about ministerial accountability and the independence of such inquiries? Do not the Government realise that by ignoring the advice of the Committee that they set up, they are giving those inquiries a bad name?
	May we also have a statement about the granting of indefinite leave to remain to people working in this country? Andrew Walmsley, the former director of the nationality unit, with 37 years' experience in the Home Office, is quoted today as saying that he has
	never come across . . . a case . . . where somebody has been granted Indefinite Leave to Remain in the UK on the basis of them working here, but not having worked here for four years.
	Given the implication of that for the inquiry into the Home Secretary's conduct, is not it vital that the position is clarified?
	Will the Leader of the House widen out the subject of Thursday's estimates day? We all know about the failures of the Passport and Records Agency computer, the Child Support Agency computer, the national insurance computer and last week's disaster with the Department for Work and Pensions computers. Today it is reported that the national fingerprint computer system has suffered a huge crash, crippling many police investigations. Perhaps it is not by chance that the system is known as NAF, but does not it just sum up the incompetence of this Government? We have all these systems, but none of them works. How can the Leader of the House claim that we are safer under Labouras he often doesif the police cannot even check a suspect's fingerprints?
	Finally, how about having a debate on British retailing? It is bad enough that Christmas starts in October in many stores, but has the Leader of the House noticed that the January sales are now starting in the first week in December? Does not that show deep concern among retailers and is not the reason for it that the Chancellor's 66 tax rises are now biting hard into the earnings of ordinary people?

Peter Hain: The last point comes from a supporter of a party that, in its last period in office, increased taxes repeatedly on all sectors of the population. We have brought taxes down for the lowest income families, with a 10p tax rate that has particularly benefited them, working tax credit and child tax credits, and a series of other measures, including the national minimum wage, to assist hard-working families. My right hon. Friend the Chancellor announced further measures today, manyif not allof which would be cut under the extravagant 35 billion cuts programme announced by the shadow Chancellor earlier.
	I apologise to Conservative Front Benchers, as I have been making the point that their cuts amount to 20 billion, whereas, according to the shadow Chancellor, they amount to 35 billion, and that does not include the extra spending of 15 billion to which he committed himself as a result of his shadow Cabinet colleagues' badgering, which suggests that there is a 50 billion black hole in Conservative finances.
	The shadow Leader of the House requested a general foreign affairs debate on Africa and the middle east. As he will recall, only on Monday the Foreign Secretary made a statement on the middle east, which was well attended. Obviously, I would be as keen as anybody to have a debate on Africa, especially as it will be a priority measure for our presidency of the G8 next year, and we shall have a look to see what opportunity there is for that.
	The hon. Gentleman requested an oral statement, should there be a settlement in Northern Ireland. Yes, of course we would want to do that and I shall ensure that arrangements are put in place.
	In response to the request of the Committee on Standards in Public Life that the Opposition be consulted, the Government have made it clear that it must first be for the Prime Minister to decide whether an investigation is needed into a Minister whom the Prime Minister appointed. If the hon. Gentleman were ever in government again, he would acknowledge that that is a sensible approach. In addition, it is important to choose an independent person to conduct such an inquiry, and I think that has been done in absolutely the right way. On indefinite leave to remain, the hon. Gentleman will know that the inquiry established under Sir Alan Budd will look at all those matters and at the wider issues that might arise.
	On extendingwidening out, as the hon. Gentleman put itthe estimates debate on Thursday, the subjects to be debated are chosen by the Liaison Committee. We cannot pre-empt that, so if the hon. Gentleman wants other subjects to be included, he should talk to the Chairman of the Committee.
	On the fingerprints computer, this is the first service delivery problem of its kind that the national automated identification service has experienced in its six-year history. The issue has not affected forces' ability to arrest and charge criminals and our first priority has been to restore forces' access to the national database. There will then be a full lessons learned exercise to identify procedural and technical changes that will prevent that from happening again, but, as I said, this is the first time such a thing has happened in six years, so I do not think that the hon. Gentleman is entitled to make a meal of it.

Paul Tyler: Over the past hour it has become apparent that Members on both sides of the House are concerned about the police grant and the precept, and the gearing effect on council tax. We have not yet had a statement on that from the Home Office. When shall we have that statement and will the Leader of the House give us an absolute undertaking that there will be an opportunity for a separate vote on that extremely important issue?
	In the Queen's Speech last week, the Government said:
	A Bill will be introduced to give effect to the Constitutional Treaty for the European Union, subject to a referendum.
	When will the House get an opportunity to debate the Second Reading of that Bill? In the programme that he has just announced, a whole afternoon is devoted to European affairs, so why cannot we have that Second Reading debate then? Is he aware that the Chief Whip has apparently already announced that Second Reading will not be debated before Christmas? I have the greatest respect for the Chief Whip, whose powers of persuasion are famousor infamous; indeed, last night, she managed to persuade Conservative Front Benchers to go into the Lobby with the Government to defend the Prime Minister and to say that he did not need to be more accountable to Parliament. That requires great powers of persuasion, but surely it is for the Leader of the House to decide and to announce to the House when business is to come before us, not the Chief Whip.
	Will the Leader of the House confirm that if the Bill makes no progress in this place before Christmas, and if the Session is interruptedperhaps next Aprilthere is no way in which the Bill will reach the statute book in this Parliament? Will he give us an absolute undertaking about when he expects the Bill to progress through the two Houses? Does he accept that there is a suspicion that the Government want some other EU member state to kick it into touch before we even get it on to the field in the House and in this country?

Peter Hain: We have made it clearthe Prime Minister has been crystal clearthat we will stage the referendum before the end of 2006, if we win the next general election. That is the deadline for ratification, and we are committed to it.
	On the hon. Gentleman's question about announcements on the progress of the Bill, I announce to the House, as he properly says, what the business of the House is, and once I am ready to tell the House when the European Union Bill will come before us, I shall do so. I would treat with a large dose of salt anything coming out of the women's lobby, which is when that conversation apparently took place. I attended the women's lobby some time agodelightful company and brilliant journalism, but attempting to get a story out of nothing is really the object of the exercise. I gather that the reporting of that issue came from the women's lobby. As I said, when I am ready to inform the House and the hon. Gentleman about the progress of the European Union Bill, I shall do so. He cannot make assumptions about the timing of the next general election. We want to get the Bill through when we can, and we will do so.
	I shall certainly look into the hon. Gentleman's point about the police grant. I know that there is much concern about the police grant, which, as he knows, is always dealt with separately from the local government announcement. We shall look into the precise arrangements for that.

Clive Betts: Will my right hon. Friend organise an early debate on the proposed improvements to the baby bond for seven-year-olds that the Chancellor mentioned in his statement today? I should certainly want to make the point that, as at the beginning of this year, more than 1,400 children in my constituency will benefit from the bond. It would also offer Members who do not support the bond and want to scrap the scheme an opportunity to explain whether it would be scrapped only for children at a future date, thus meaning that only a handful of children would benefit from it for only a small number of years, or whether they intend to take back from children's piggybanks the bonds that have already been givensnatching money back from children to pay for the expensive introduction of a unneeded local income tax.

Peter Hain: My hon. Friend makes a telling and interesting point. Members who advocate the abolition of the child trust fund, especially those on the Liberal Democrat Benches, will have to answer a very important question for all the youngsters and the parents of children who will already have received the average bond of 250500 in the case of low-income families. The money will already be in those children's piggybanks. Will the Liberal Democrats raid them and send in robbers to take the money back, and will they deny youngsters the opportunity, when they reach the age of seven, to receive up to 500 in addition? There will be 1,000 sitting in the piggybanks of children in low-income families. That would be daylight robberyor perhaps night-time robbery in the case of the Liberal Democrats.

Peter Luff: As I understand it, the statement that we have just heard on local government finance marks the beginning of a consultation process. Given the growing importance and sensitivity attached to local government finance and council tax, will the Leader of the House arrange a debate, ahead of the final debate when we endorse the orders for the local government finance settlement, to enable the House to be consulted about the progress of local government finance settlement consultation? There is a ridiculous situation in Worcestershire, where there is a growing gap between us and our neighbours: the capping of the fire authority, the unreasonable settlement for West Mercia police authority, the unreasonable refusal to give us area cost adjustment and, this week, the announcement that we are to lose another 1 million just because the Government got their figures wrong and are taking the money back. We are beginning to ask what we have done to upset the Deputy Prime Minister or the Minister for Local and Regional Government. Could we be told, please?

Peter Hain: I find it very difficult to follow the hon. Gentleman's point. The Chancellor has just announced an extra 1 billion of available funding to help local government ensure that council tax rises are low and that local government gets a decent deal.
	Today's statement is the beginning of a process of engagement with local authorities on the final outturn of their provision. There will obviously be an opportunity to consult on that, and I shall consider the point that he made in respect of any follow-up.

Graham Allen: The Leader of the House will realise that one of the most widely welcomed measures in the Queen's Speech, by all parties in the House, is the consumer credit Bill. It is nothing to do with credit cards; it is to do with stopping lenders levying extortionate rates of interest on individuals. One of my constituents borrowed 8,000 and has had to repay 120,000. Will my right hon. Friend ensure that the good will towards that measure that exists in all parties is not turned sour by the fact that the Bill is timetabled at a point at which it cannot be realised? Will he also acknowledge that he has received a letter today from more than 100 Members of Parliament from all parties, requesting that time be given for an early Second Reading of the Bill? This is a matter of concern to everyone. Will he ensure that it does not turn sour?

Peter Hain: First, I am indeed aware of the letter that my hon. Friend and his colleagues have sent me, asking for progress on that Bill to be made as early as possible, and I understand the reasons. The Government are fulfilling a manifesto commitment to introduce a Bill to tackle the problem of rogue traders and loan sharks to bring to an end the appalling experience that his constituent and many of our constituents have endured. There is cross-party support for that principle, and I hope that the Bill will have cross-party support and that it will receive Royal Assent as early as possible. I cannot give him the date for Royal Assent, but I will certainly look at the Bill's likely timetabling to see what we can do.

Patrick McLoughlin: Will the Leader of the House look at the report of today's Education and Skills questions and arrange for the Secretary of State to make a statement to the House some time next week about his rather stupid comments? When I simply asked him why a primary school child in Derbyshire received less than a primary school child in Nottinghamshire, the Secretary of State said that that was because Nottinghamshire had better representation. Is that not an outrageous attack on the Secretary of State for Environment, Food and Rural Affairs, putting a new meaning on Cabinet collective responsibility, and on the hon. Member for Bolsover (Mr. Skinner) and the other six Labour MPs who represent Derbyshire constituencies?

Peter Hain: I was going to say that, after the next general election, that would involve seven Labour Members of Parliament. I would have thought that the last thing to do was to call my right hon. Friend the Secretary of State for Education and Skills stupid and to criticise him for making a stupid statement. He has presided over increasing school standards, the recruitment of more teachers and classroom assistants, more modern schools, the refurbishment of schools, the opening of new schools and more IT equipment, including in Derbyshire. He can be proud of that, and the hon. Gentleman should withdraw his outrageous accusation.

Julie Morgan: Will my right hon. Friend arrange an early debate on private companies and their social responsibilities? Is he aware that Western Power Distribution has written to members of the public in my constituency about stopping access to the Llanishen reservoir from 1 January 2005? In a meeting that I had with Western Power Distribution's representatives, they said that that is for pipe maintenance, but they also said that they will give no commitment to reopen Llanishen reservoir to the public. The area has been used for decades by the public for walking and enjoying the natural surroundings. The public in Llanishen are absolutely furious about Western Power Distribution's decision. Does he not agree that its decision is outrageous? Will he arrange for us to have a debate in which such subjects can be aired?

Peter Hain: I am indeed aware of the value to local residents of Llanishen reservoir. They have had rights of access for a very long time, and I would want them to continue. I undertake to write to Western Power Distribution and take that point up, wearing my other hat as Secretary of State for Wales. I am sure that my hon. Friend will agree that Western Power Distribution has served Wales extremely well and does a very good job on behalf of Wales. Perhaps it can look again at that issue, given the points that she has made.

Alex Salmond: Given the result in the English High Court this morning, may we have a debate entitled Fake documents and who might be forging them, so that we can consider not just the documents that cost The Daily Telegraph so dear this morning but documents such as the forgery of the uranium imports from Niger, which cost us all dear in the sense that they informed the Government's disastrous policy in Iraq? Given that I seem to remember that, in his old campaigning days, the Leader of the House once emerged from a court vindicated, can he find it in his heart to congratulate the hon. Member for Glasgow, Kelvin (Mr. Galloway) on his victory today?

Peter Hain: The court verdict is obviously a great boost for the hon. Member for Glasgow, Kelvin (Mr. Galloway).
	The hon. Member for Banff and Buchan (Mr. Salmond) took a different view on the war in Iraq. He did not think that we should intervene at all and that Saddam Hussein should stay in power. Saddam would be in power today if the hon. Gentleman's policy and that of the Liberal Democrats had been followed. It was a perfectly honourable policy, but its consequences would have been that the world's most brutal tyrant would be continuing to exercise his tyranny even today. Of course, he is now in jail, and the people of Iraq are a great deal better as a result.

Eric Forth: The Leader of the House will well know that there are only some 37 or 38 legislating days between now and the Easter recess. Given the complete control that the Government now have over Commons business, will he give us his assessment of how many Bills in the Queen's Speech and outside it will complete all their Commons stages between now and Easter and of how many Bills will receive Royal Assent before Easter?

Peter Hain: We may or may not exercise complete control over the House of Commons, as the right hon. Gentleman charitably puts it, but we certainly do not exercise complete control over the House of Lords.

Eric Forth: Thank goodness.

Peter Hain: Thank goodness, he says, but Labour has less than 30 per cent. of the votes in the House of Lords. It is a Conservativewith a big C and a small cdominated second Chamber, and any speedy progress that we may make on excellent measures such as the Identity Cards Bill, the Serious Organised Crime and Police Bill, the drugs Bill, or, indeed, the consumer credit Bill, the charities Bill and so on could be wrecked by obstructionism in the House of Lords.

Eric Forth: Good.

Peter Hain: Good, he says, so the right hon. Gentleman thinks that the charities Bill, the Disabilities Discrimination Bill and the consumer credit Bill should all be obstructed in the House of Lords, does he? Well, now we know where he stands. Perhaps those on the Conservative Front Bench could either denounce him or agree with him, and then we would know where they stand, too.

Martin Smyth: In his statement, unless I misheard, the Chancellor made a welcome announcement that about 2 billion had been saved, including in the health service drugs treatment budget. May we have a statement from the Secretary of State for Health on whether the money will be retained in the health budget to buy the new drugs that people are crying out for in the treatment of Alzheimer's, multiple sclerosis and other diseases, or on whether the money has been subsumed into some other budget?

Peter Hain: I understand that the results of negotiations with the drug companies and others have released extra funding for front-line services. I am sure that the Secretary of State for Health will note the point that the hon. Gentleman makes, and, to the extent that I understood the point, I am sure that the hon. Gentleman will agree with what my right hon. Friend has done.

Julian Lewis: May I put in a word of support for the important campaign that the hon. Member for Nottingham, North (Mr. Allen) is waging to try to limit the activities of loan sharks?
	May we have a statement from the Minister for the Cabinet Office about reports of accelerated destruction of departmental files in many Departments in the run-up of the coming into force of the Freedom of Information Act 2000 on 1 January? That appears to be an extremely worrying development, but I am happy on this occasion to exonerate entirely the Chancellor of the Duchy of Lancaster because, as he is spending so much of his time on non-departmental work on Labour's election campaign, I cannot imagine that he has developed any file worthy of being shredded.

Peter Hain: The hon. Gentleman's constituents will applaud him for being a one-question man. Whatever he asks, he manages to get in a spurious point about the Chancellor of the Duchy of Lancaster.
	I am glad that the hon. Gentleman supports the Government's policies on loan sharks. May I therefore assume that he will encourage his Whip to ensure that the consumer credit Bill is given a free run through the House of Commons and the House of Lords[Interruption.] It is, of course, the right of the House of Commons to scrutinise it.
	The hon. Gentleman is an expert conspiracy theorist. He is eloquent and diligent in his chasing of those theories, but this one takes the biscuit. Of course, a Labour Government introduced the Freedom of Information Act, and there are consequences as a result of that, including his ability to ask spurious questions.

Fisheries

[Relevant document: The uncorrected transcript of Minutes of Evidence on the Future for UK Fishing taken before the Environment, Food and Rural Affairs Committee's Sub-Committee on the Future for UK Fishing on 16th November 2004, from the National Federation of Fishermen's Organisations, the Scottish Fishermen's Federation and WWF UK, HC 1278-i.]
	Motion made, and Question proposed, That this House do now adjourn.[Mr. Bradshaw.]

Ben Bradshaw: It gives me great pleasure to open our traditional annual fisheries debate. I am grateful both to you, Mr. Deputy Speaker, and to the business managers for enabling us to adhere to the recent convention that the debate is held before the important December Fisheries Council. It allows hon. Members to make specific points that are of particular interest to their constituents and enables me to take those on board before entering the negotiating chambers in Brussels. That is an opportunity for which hon. Members and I are extremely grateful.

Alistair Carmichael: The Minister will be aware that the Commission's proposals are not due to be published until 8 December. Will he give an undertaking to those of us who represent fishing communities that, either formally or informally, there will be opportunities after the publication of the proposals and before the Council meeting for him to hear the concerns of our constituents?

Ben Bradshaw: I am always prepared to take representations from hon. Members, especially at this time of year, in the run-up to the December Fisheries Council.

Eddie McGrady: Great benefits are had by all if there is prior consultation and if advice is taken from the various fishermen's organisations. That has not happened in Northern Ireland. Is it a matter of policy not to consult the Northern Ireland fishermen's organisations at this stage, or has that been remedied? I understand that they were refused an audience.

Ben Bradshaw: That is not my understanding. The Under-Secretary of State for Northern Ireland my hon. Friend the Member for Dudley, South (Mr. Pearson) leads on fisheries issues for Northern Ireland, and he has been assiduous in keeping in touch with industry representatives in Northern Ireland. He was with me at the last November Council, and I believe that he met industry representatives from Northern Ireland at that time. We will continue to keep in close contact between now and the Council itself.
	Landings by the fishing industry are worth about 520 million to the UK economy. Landings at most ports are steady or up. The pelagic sector, which relies mainly on herring and mackerel, is doing very well, as is the shellfish sector. The importance of nephropsor prawns, as most people know themcontinues to increase as a proportion of the UK's total catch. Haddock stocks are higher than they have been for 30 years. However, some other species are still in decline or their stocks remain at dangerously low levelsmost notably, cod.
	The fish processing industry continues to go from strength to strength. In all, it is worth about 1.5 billion to the UK economy. I am pleased to reportnot least because of the benefits to our nation's healththat fish consumption in the UK continues to grow by about 1.3 per cent. a year.

Alex Salmond: The Minister mentions that certain stocks are in a healthy condition. Is it not remarkable that one of the failings of the common fisheries policy is that it cannot take account of that properly? Certainly, prawn quotas are far too low given what we know about the robust nature of the stocks. He says that haddock stocks are at a 30-year high, but according to the Norwegian talks, the quotas are to decline in the coming year.
	On monkfish, the Commission has acknowledged for the first time that the previous scientific assessment was at best tenuous. There is huge evidence of plentiful supplies, yet the monkfish fishery is closed, so that high-value species, at the most valuable time of the year, is not accessible to hard-pressed fishermen. What will the Minister do to avoid a repeat of the situation in which fisheries with plentiful stocks

Mr. Deputy Speaker: Order. I think that the hon. Gentleman wants to catch my eye a little later. I am sure he will want to save some remarks for then.

Ben Bradshaw: Perhaps it will help if I inform hon. Members that a good chunk at the end of my speech is devoted to the details of the various stock levels and the recommendations in the run-up to the Council. Hon. Members may prefer to leave their interventions until then, when I shall address the issues raised by the hon. Gentleman.
	This year has also reminded us of the dangers faced by those involved in the harvesting of the sea's natural resources. Nine have died during the course of the year in incidents involving seven fishing vessels, and 21 Chinese cockle pickers were drowned in Morecambe Bay in February. Most recently, two brothers, Rob Temple and Brian Allinson, from North Shields, have been lost, and only a few days before that, a Northern Ireland fisherman, Colin Donnelly, died off the Isle of Man. I am sure that the sympathy of the whole House goes out to the families and friends of those who have died working the seas.

Bob Blizzard: Will my hon. Friend join me in thanking the Royal National Mission to Deep Sea Fishermen for its work in the circumstances that he has mentioned?

Ben Bradshaw: I am pleased to endorse my hon. Friend's comments. It gave me great pleasure during the past year to attend the RNMDSF annual reception, at which it gave out awards. The organisation plays an important role in many parts of the country, including in many constituencies represented by Members who are in the Chamber.
	The past year has also seen an unprecedented level of interest and activity in fisheries policy. We have had a major report from the Prime Minister's strategy unit called Net Benefits. It was the first time a Government had commissioned such an in-depth study of the state and future of the fishing industry. It has sparked immense interest both here and abroad, and is likely to help inform policy decisions for many years to come.
	We have also seen an important report by the Royal Society of Edinburgh, and await the publication next week of a major report by the Royal Commission on Environmental Pollution. The Government intend to respond to the strategy unit report next spring. The reports are all slightly different, but what they share is a belief that the sustainable exploitation of our marine resources is a major challenge, and one that must be taken up at global level. They also agree that there can be a long-term profitable future for our commercial fishing industry only if catch levels are brought into line with the state of fish stocks, and kept there. They have something else in common as well. They all oppose the only policy that the Conservative party has on fisheries, which is to try to withdraw unilaterally from the common fisheries policy.

David Burnside: On subject of the reports, there is considerable concern in the industry in Northern Ireland about the resources of the Department of Agriculture and Rural Development. Although it has committed itself to carry out a review of cod recovery in the Irish sea, the industry in Kilkeel believes that it does not have the resources to do that. Is the national Department prepared to go into discussions with DARD to find out whether a more fundamental review of cod stocks in the Irish sea is needed?

Ben Bradshaw: I will certainly undertake to look into the hon. Gentleman's point. From the interaction that I have had with the Under-Secretary of State for Northern Ireland and his officials, I have not gained the impression that they do not represent Northern Irish interests strongly. However, I shall certainly consider the point about capacity that the hon. Gentleman raised and ensure that we are engaged in this important work. It is important that the Administrations throughout the United Kingdom engage on the process, and that we move forward together on fisheries policy.
	It is against the background that I have described, as well as wider concerns about our marine environment that the Prime Minister announced earlier this autumn his support for a new marine Bill.
	One more important review that reported during the last year would help to inform future policythe Bradley review of marine fisheries and environmental enforcement. It is important that all those reports and reviews have come together, because they provide policy makers with a once-in-a-generation chance to get the way we run our fisheries right. I wish to take this opportunity to thank all those who have played a role in producing all this important material. The challenge that we, the fishing industry and other stakeholders now face is to turn it all into policy.
	I should mention one or two other important developments this year before I turn to the details and our priorities for the December Council. Last month, I attended, in Edinburgh, the launch of the first of the regional advisory councils set up under the important reforms of the common fisheries policy agreed two years ago. The North sea RAC involves all those with an interest in the North sea, and it is already at work drafting recommendations on the management of the North sea area.
	In the European Union, the UK has been at the forefront of pushing for a decentralisation of the common fisheries policy and for a greater say at local and regional level for fishermen and other interested groups. We intend to make progress on the remaining RACs a priority for the UK presidency of the EU in the second half of next year. If the RACs prove themselves by coming up with realistic and responsible solutions to the management challenges that we face, I see no reason why they should not develop into real bodies for regional management.
	In the south-west of England, where I hail from, we are already seeing the benefits of the fishermen, processors, retailers, restaurateurs, anglers, environmentalists and scientists all working together to manage our fisheries in a sustainable way. Invest in Fish South West, launched by His Royal Highness the Prince of Wales in April with funding from my Department, is leading to an unprecedented level of co-operation among groups that in the pastlet us be frankhave not always seen eye to eye. The commercial fishermen, recreational sea anglers and environmentalists who, in the past, have had competing or conflicting agendas have come together in the realisation that we all have a shared interest in managing our marine resources in a responsible and sustainable way. The benefits of this co-operation go far wider than the fishing industry alone. Tourism and our regional food renaissance are already benefiting from the work of Invest in Fish South West. I hope that it can become a model for the rest of the UK.

Anthony Steen: I know that the Minister is doing his very best, and many of us realise that he is not quite King Canutewe know what happened to him; was he not washed away?
	The problem in the south-west is that more fish are thrown back dead than are landed in the ports. The Minister must agree that that is immoral and obscene. Does he agree that the best way of dealing with that problem is to renegotiate the common fisheries policy, which he has failed to do? If that is the case, what is the alternative to our policy of withdrawing from the common fisheries policy, unless we are to go on throwing more dead fish overboard than we actually land?

Ben Bradshaw: I am not sure whether the hon. Gentleman was agreeing with his party's policy of withdrawing from the common fisheries policy or advocating renegotiation. Of course, renegotiation goes on all the time. The reforms that we achieved two years ago were a renegotiation of the common fisheries policy. Indeed, the policy addresses the very problem of discards that he has just outlined. It is not right to suggest that more fish are thrown overboard in the south-west than are landed. However, the hon. Gentleman is right to say that discards are a problem. There is not a fisheries system in the world that has managed to avoid the problem of discards completely. It is a serious problem, particularly in the mixed fisheries, and we are actively addressing it.

Alex Salmond: A few seconds ago, the Minister said that he saw no reason why regional advisory councils could not adopt management responsibilities. Why then does the proposed European constitution maintain exclusive competence over the conservation of marine biological resources? The maintenance of that competence was described last week by the European Parliament's own Committee on Fisheries as unjustified. Does the Minister not see a contradiction between his statement and the European constitution?

Ben Bradshaw: No, I do not. Because of the many conversations and exchanges of letters that we have had on this subject, the hon. Gentleman knows that we will have to agree to disagree on it. There is no change in the European constitution on the competence on marine resources, as he knows very well.
	The Government's concern to manage our marine environment sustainably can be illustrated by a number of other actions we have taken this year. We secured permanent protection for the cold water coral reefs off the north-west coast of Scotland known as the Darwin mounds. This followed the emergency protection that we secured in the previous year, which was the first time the EU used powers under the reformed common fisheries policy to give special protection to a valuable marine environment.
	The UK also led the way in persuading the EU to adopt, for the first time, measures to address the problem of cetacean by-catchthe catching and drowning of dolphins and porpoises in nets. These measures did not go as far as would have liked and the UK will continue to push for more action more quickly, but they are an important start.

Anthony Steen: It is a real treat to be allowed to ask two questions, and I am most grateful to the Minister. As he knows, along the length of the south Devon coastline dolphins are washed up dead on the beaches. One was washed up in my constituency only this week. Although he has taken a lead in trying to limit bass fishing, the French in particular are notorious for carrying it out along our coastline. Has the Minister not banned the French from breaching the 12-mile limit, so are they breaking the law? As for Europe, he has failedalthough I accept that he has triedto do something more. When is his next battle, and will he lose it?

Ben Bradshaw: The hon. Gentleman makes the argument about the common fisheries policy for me. If we did not belong to the CFP we would have no influence whatever over what the French did in their own waters or halfway across the channel, where most of the bass pair trawl fishery takes place.
	The first experimental marine closed area in Britain, around Lundy island off the north coast of Devon, has been a resounding success. The number and size of crab and lobster both inside and, more importantly, outside the closed area has grown significantly. My view has always been that closed areas, if supported by the scientific evidence, are likely to play an important part in our future management of marine resources. That is another subject that the UK intends to prioritise during our presidency of the EU next year, and my officials are already exploring the benefits of a network of such areas as part of the follow-up to the strategy unit report.
	This annual debate has traditionally concentrated on the commercial marine fishing sector in advance of the all-important December Council. However, as its title is Fisheries, it would be remiss of me not to acknowledge the important and growing role played by recreational angling, both at sea and in our lakes and rivers. Britain's most popular recreational pastime goes from strength to strength. The importance of angling, and sea angling in particular, has not always been recognised in the past, and I want to give anglers a greater say in how we manage our fisheries.
	The UK has remained at the forefront of international efforts to protect the whale. At this year's international whaling conference, we helped to resist attempts by Japan and others to lift the moratorium on commercial whaling. We will continue to work with like-minded countries and world opinion to stop the small handful of whaling nations and their allies trying to weaken the protection that those magnificent mammals enjoy.
	Turning to our priorities for the annual Council of Ministers meeting just before Christmas, as always, the UK's priority is to maximise opportunities for our fishermen while ensuring that fish stocks are not over-exploited. The latest scientific advice should mean that the Council can agree an increased total allowable catch for some stocks, including western monkfish and megrim, as well as west of Scotland nephrops, However, tough decisions are likely on stocks that are not doing so well, including plaice and sole in the south-west, cod in the North sea, the west of Scotland and the Irish sea, and sand eels.
	This year, my officials and I have gone to extra lengths to include industry representatives in discussions in the run-up to the Council. We will continue to keep in close touch with them until and during the meeting. That unprecedented co-operation helped to achieve a satisfactory outcome to the potentially difficult EU-Norway negotiations last week. It is unlikely that the industry will get everything that it would like out of the December Council, but I believe that the way in which we have worked together over the past year will make it easier for the UK to make a more robust and coherent case.
	Finally, during last month's Council meeting, I, along with my Scottish colleague, Ross Finnie, had the opportunity to meet the new Fisheries Commissioner, Joe Borg, on his first day in his new office. We had a wide-ranging and friendly conversation in which Mr. Finnie and I outlined to Mr. Borg and his officials our main concerns and priorities. I am pleased to tell the House that Mr. Borg accepted our invitation to visit the UK early in the new year.

Owen Paterson: I begin by paying tribute to fishermen who lost their lives or were injured last year. My figures show that 27 vessels were reported lost and 11 men died. In his statement, the Minister mentioned several more recent deaths. I extend our deepest sympathies to the families and friends of those brave men who put their lives at risk in order to supply us with a healthy and popular food. We owe them more than we are offering them todaya mere three-hour Adjournment debate jammed in at the end of the week, after two lengthy and important statements.
	The annual fishing debate used to take a full day, and it was intended to give the Minister a mandate before he set off for Brussels and the annual Fisheries Council. We are in no position to do that today. The only document available is a transcript of oral evidence taken by a Sub-Committee of the Environment, Food and Rural Affairs Committee, chaired in his inimitable, colourful manner by the hon. Member for Great Grimsby (Mr. Mitchell). We have not seen the Commission proposals and we have no basis for a serious discussion. All we can do is wish the Minister the best of luck on 21 and 22 December.
	The Minister will be presented with a huge amount of material, much of it inaccurate and most of it out of date, and decisions of great complexity will be taken at very short notice. I urge him to keep the representatives of the industry in the loop. At last year's Council they were left alone and ignored in their hotels, and a settlement for the North sea was agreed without their advice. The details turned out to be totally impractical. I am not suggesting that they have a veto, as the Minister said in questions two weeks ago, just that they be consulted on the practical consequences of any proposals that he may be about to agree to. Those men represent an industry that has been forced to accept huge reductions in capacity and opportunity in recent years, and with enlargement it looks as though the opportunities may be further reduced.
	Since last year's debate I have visited numerous fishing communities around our coastAberdeen, Peterhead, Fraserburgh, Shetlands, Whalsay, Ullapool, Stornoway, Plymouth, Brixham, Hastings, Folkestone, Scarborough, Whitby, and, most poignantly, Fleetwood, twice. Fleetwood has seen the number of vessels fall from 64 to 25. I met the manager of an engineering company who only 20 years ago employed 120 people. He now employs one fitter.
	I was told on my first visit about the high level of discards in the Irish sea and I simply did not believe it, so I returned two weeks later to see for myself. I spent the night of the 1415 October on the trawler Kiroan. In order to fish 22 days per month, 80 mm mesh must be used for plaice. If 110 mm mesh is used, Phil Dell, the skipper, told me, his days at sea are reduced by five and his business is no longer viable. We set off and I instructed him to set one trawl of his twin rig with 80 mm mesh and the other with 110 mm mesh.

Alistair Carmichael: You instructed him?

Owen Paterson: I instructed him because what he was doing was against the regulations. We took out the first haul at about 5.30 am. The 80 mm mesh was extremely full. It showed thousands and thousands of tiny juvenile plaice peeping through the mesh. Probably 90 per cent. had to be discarded. In contrast, the 110 mm mesh was about two thirds full and contained 80 per cent. saleable adult fish. This was in the night, when the tides were adverse, and there was still that catch and by-catch. We repeated the exercise, and at 9.15 am the result was even worse.
	It is hard to understand how sane human beings can insist that such a system is enforced when it clearly causes so much damage. The appalling scandal of discards is a direct result of the system whereby the common fisheries policy imposes its quota system. The CFP is a biological, environmental, economic and social disaster. It is our clearly stated policy to leave the CFP and establish national and local control.

Michael Jabez Foster: That is indeed what the hon. Gentleman told the fishermen of Hastings. What he did not tell them is how he would do that. Would he negotiate with anyone to leave the CFP, and if so, with whomI know of no oneor would he just break the treaty?

Owen Paterson: That is a helpful intervention, as it leads on to a letter that my right hon. and learned Friend the Member for Folkestone and Hythe (Mr. Howard), the hon. Gentleman's near neighbour, wrote to my hon. Friend the Member for Maldon and East Chelmsford (Mr. Whittingdale). My right hon. and learned Friend wrote on 9 June:
	We are determined that the next Conservative government will establish national and local control over fishing. We intend to raise this in the Council of Ministers at the first opportunity and I believe we can achieve this by negotiation. However, should negotiation not succeed, it remains the case, as I said in Plymouth, that the British Parliament is supreme and we would introduce the necessary legislation to bring about full national and local control.

Bob Blizzard: What would the hon. Gentleman do to solve the problem of discards? Even if we withdrew from the CFP, what would his solution be to that problem?

Anthony Steen: Days at sea.

Owen Paterson: If the hon. Gentleman will give me a little more time, I shall come to that issue. The answer, as my hon. Friend just said, is days at sea. The Minister is wrong to say that no fishery has found a solution to the problem. The Faroes have found a solution, as has New England. If one goes for days at sea, one sees that much of the discard problem has been eliminated.

Ben Bradshaw: On the Conservative policy of withdrawal from the CFP, the hon. Gentleman has explained that, if a future Conservative Government acting alone failed to persuade every single other member of the European Union to allow them to leave the CFP but stay in the EU, his party would introduce a Bill in Parliament. What would the Bill say, and how would the Conservatives achieve a treaty breachas he knows, such a breach has never happened beforeand still expect the UK to stay in the EU?

Owen Paterson: The Minister and I had an interesting debate on this issue in the regional press. It is very simple: membership of the CFP is not a criterion for membership of the European Union. On a global issue, with the fall in the dollar, the status of the euro is fundamental, and yet two of the largest contributors to the euro, France and Germany, have unilaterally broken their obligations in respect of it. He mentioned the new commissioner, Mr. Borg, who comes from Malta. The CFP does not apply to the Mediterranean countries in the same way as to the UK. There are also the land-locked countries, including famous buccaneering, swashbuckling countries such as Slovakia, Hungary, Luxembourg and Austria, which are also active of members the European Union but not of the CFP.

Lawrie Quinn: I thank the hon. Gentleman for the courtesy of advising me that he was going to visit Scarborough and Whitby. I hope that he enjoyed his fish and chips in the restaurant of the vice-chairman of the Tory party in Scarborough. Has he embarked on any discussions with the land-locked or Mediterranean nations that he has just listed about applying the Conservative party's policy should it win the next general election?

Owen Paterson: I am grateful for the hon. Gentleman's comments about my visit to his constituency. It was a good visit and I thoroughly enjoyed it. We have a very fine candidate in Mr. Robert Goodwill, as the hon. Gentleman will find out when the election comes, and the fish and chips were indeed excellent.
	The answer to the hon. Gentleman's question is no; I have concentrated my efforts on going to fishing countries, as I am about to explain. I have been to places such as the Faroes, Iceland, Newfoundland, Nova Scotia and New England, where successful fisheries are run because there is national and local control.

David Burnside: On national interest, is the hon. Gentleman aware that there is a system called the Hague preference whereby Northern Ireland fishermen have their quotas transferred to our neighbours in the Irish Republic, which has a Government who are financing modernisation of their fishing fleet and an increase in its size, while we in the United Kingdom are decommissioning our fleet?

Owen Paterson: That is a very good point. Subsidies are one of the most damnable and dangerous elements in fishing, because they break the commercial rules. The nightmare that arose in Newfoundland was caused mainly by subsidised activity, first in the Soviet Union and then in Canada itself. I entirely endorse the hon. Gentleman's comments: subsidised fishing capacity is very damaging, and we would like to see it dramatically reduced. We would not tolerate any subsidised activity if we had national and local control.

Andrew George: With regard to the Conservatives' proposal to negotiate withdrawal from the CFPI am sure that all of us, including the hon. Gentleman, agree that it is extremely unlikely and probably impossible that they could negotiate a way outand their fallback position of committing a breach of the treaty, what estimate has he made of the cost to the UK taxpayer? Without doubt, the consequences of such a withdrawal would be significant. Fines would be imposed by the European Court of Justice, and there would be litigation from other member states and possibly boycotts and other tariffs. What estimate has he made of the cost to the UK taxpayer of his pursuing that policy?

Owen Paterson: I refute the hon. Gentleman's premisethis is not a nil sum game. If he examines the history of the Falklands, general mayhem occurred before 1986. There was a lot of fishing activity, stocks were not controlled and the Spanish were among the worst culprits. The Spanish were brought under control once national control was established in the Falklands. They are now the most constructive participant in the fisheries: they are the largest investors and Vigo bay is the largest market for Falklands squid.
	Our partners will not see our action as totally negative, because they are currently being offered a bleak future. As the Minister has explained, stocks are declining, and our partners will be offered a share in a declining resource. If they work with us, however, and we copy successful methods, which I have seen with my own eyes in the Faroes, Iceland, Nova Scotia and New England, the resource will expand and they can participate.

Ben Bradshaw: A moment or two ago, the hon. Gentleman said that some existing members of the European Union are not members of the CFP and that the CFP does not apply to some EU members. Will he clarify those comments?

Owen Paterson: Yes; the full rules of the CFP do not apply to the Mediterranean states and the land-locked states. The Minister keeps trying to make the point that it is essential to be part of the CFP to be part of the European Union, but that is not the case. The EU is in a constant state of flux and the issue is a matter of political will. Our party has a firm, clearly stated view that the CFP cannot be reformed. The CFP has done grotesque damage to our marine communities and marine environment. We want to establish national and local control to 200 miles or the median line. I cannot put it more clearly than that.

Ben Bradshaw: I am grateful for the helpful clarification that the CFP applies to all member states. Management regimes within the CFP can vary according to regional conditions. For example, different regimes apply in the North sea, the Baltic and the Mediterranean.

Owen Paterson: I am glad that the Minister is pleased with my explanation.

David Heathcoat-Amory: Is my hon. Friend aware that the European constitution entrenches and centralises the CFP, making it even worse than it is now? When we reject the European constitution, as we certainly will, it will be the perfect opportunity to withdraw from the CFP. Renegotiation would put us in charge, because any replacement constitution can be agreed only with our agreement and in spite of our veto. Withdrawal from the CFP, and indeed any other powers with which we disagree, will follow naturally from the people's rejection of the European constitution.

Owen Paterson: My right hon. Friend has made a good point. I pay tribute to his attempt to bring fisheries into the negotiation in the Convention last year. The Government missed a great opportunity to raise fishing at that time. He is, of course, right that this country will vote no to the constitution, because it wants to remain an independent sovereign nation. At that point, we will be in a strong bargaining position to debate our fishermen and our marine resource.

Anthony Steen: I pay tribute to the masterly way in which my hon. Friend has captured his brief, although his constituency is land-locked. If the CFP did not result in more dead fish being thrown overboard than are landedthe Minister doubts the figures, but he has not got a clue because he does not know how many fish are thrown overboardthe Conservative party would not be so adamant about withdrawing from the CFP. The fact that successive Labour Ministers have failed to adjust the CFP is the reason why the only way forward that we can see is withdrawal.

Owen Paterson: That is essentially itthe CFP is not amendable. Discards will not be eliminated and biomass will not grow until the whole system is changed.

Alex Salmond: I agree with the hon. Gentleman that national control provides a more focused fisheries policy because it confers ownership. However, a few moments ago he congratulated Professor Neil McCormick, who, in the Convention that negotiated the constitution, was the first and most doggedly persistent person to point out the dangers of exclusive competencies. Did I hear the hon. Gentleman right when he said that he is against the Hague preferences? Those are extremely helpful to Scottish fishermen, and I would not like the Conservative party to revert to its policy of regarding Scottish fishermen asI quoteexpendable, as it did when it took us into the common fisheries policy.

Owen Paterson: I repeat my tribute to my right hon. Friend the Member for Wells (Mr. Heathcoat-Amory), who mounted a brave campaign in the Convention on the issue. I have no idea what Scottish National party did; all I know is that it is tagging along behind us. This has been our policy under the past three leaders.

David Heathcoat-Amory: For the illumination of the House, I can confirm that Professor McCormick tabled an amendment to take the common fisheries policy out of the constitution as an exclusive competence of the Union, but I tabled further amendments to remove it altogether and to repatriate these vital powers back to member states. Sadly, I was not supported by the Scottish National party, as I should have been.

Owen Paterson: I am grateful for that clarification.

Lawrie Quinn: I want to bring the hon. Gentleman back to the issue of withdrawal from the common fisheries policy

Austin Mitchell: Boring.

Lawrie Quinn: It is not boringit is very important to my constituents, and to those of my hon. Friend.
	I repeat the question that the hon. Gentleman was politely asked by the hon. Member for St. Ives (Andrew George): what will be the cost to the nation of withdrawal? If he cannot tell us now, when will the Conservatives be able to advise my constituents, and the nation, of that cost?

Owen Paterson: I do not go along with the contention that it will be an immensely acrimonious negotiation.

Lawrie Quinn: What will be the cost?

Owen Paterson: I have not worked out the cost. I think that there will be gains for those countries that participate in our waters. As I said, at present they are being offered a declining proportion of a declining resource. I know that we can grow our biomass, grow the resource and grow our catches again if we follow modern, intelligent techniques, as employed in the Faroes, Iceland, and Norway, where I was on Monday and Tuesday this week. They have successful fisheries because they have national and local control. We would welcome foreign participation on the basis of historic rights; there will therefore be a gain for those fisheries. I refer again to the Falklands, where the Spanish are major playersthey are the largest investors and have the largest market in Vigo bay for Falklands squid. It has worked extremely well for them, but only since they established national control in 1986.
	I am aware that we have only three hours, and I must push on. The optimism in those other fisheries is striking compared with the gloom that I encounter here. That is because the decisions of the CFP are basically political. In Reykjavik, I met the head of one of the largest banks in the world investing in worldwide fishing businesses. He has made it company policy not to invest in any European Union or Russian fishing business because of the interference and political risk of the arbitrary decisions made under those regimes.
	The failure of the CFP is also confirmed by an interesting report that was published in August by the RIVO-Netherlands Institute for Fisheries Research. It says:
	With the possible exception of pelagic stocks targeted by specific fisheries with relatively small by-catches of other species, the CFP toolbox of catch quota, capacity control and technical measures has not been effective in meeting the long-term strategic objectives of sustainable fisheries in EU waters without challenging the quality of the marine environment. The main problem relates to mixed fisheries that can continue fishing until the quota for the last species exploited has been exhausted as long as catches of others are discarded. Therefore, quota regulations effectively don't limit exploitation rates of demersal species and other regulatory measures seem required. However, the CFP reform process showed that the political will to change the management system is severely limited.

Anthony Steen: Is my hon. Friend aware that, in the towns of Brixham, Dartmouth and Salcombe, the seagull population has increased sixfold, causing havoc to the people who live there and all their equipment, which is covered in seagull mess? Their dustbins are also raided. Does he know that that has been caused solely by the number of fish thrown overboard dead under the common fisheries policy? The enormous resultant growth of the seagull population causes mayhem for my constituents.

Owen Paterson: That is a good point. I actually picked that up when I went to Brixham. The lesson from Brixham is the extraordinarily complex nature of the fishery. We must have seen 20 to 25 species in the fish market in the morning. That is why the quota system is unsuited to exploiting that resource. We should learn from other, more successful fisheries.
	We should set a broad national framework on the basis that we believe that the seas around Britain belong to the people of Britain and need to be managed in the interests of all the people. Aristotle said that that which nobody owns, nobody cares for. We would like national Government to set a broad framework, as the Magnuson-Stevens Fishery Conservation and Management Act does in the United States of America. However, detailed management should be devolved to local councils. Rather than abolishing existing fishery committees, as the Government threaten to do, we would like them to be built on, expanded and extended.
	The Minister rightly paid tribute to the recreational sector. There are 1.5 million recreational anglers, with a turnover of 1 billion per annum. They should have the right to be consulted and have a real input in determining fishing management plans where there is significant recreational activity.
	The regional advisory councils, which the Minister mentioned and the Commission proposed, will be only advisory. He confirmed that to me in parliamentary answers. We would prefer genuine local control, establishing local management plans with teeth.
	We would scrap the rigid quota system and learn from the Faroes and New England, where days at sea limitation of effort has led to a striking increase in fish catches and biomass. In contrast to Britain, fishermen there trust and work closely with scientists, leading to better assessment of stocks. As my hon. Friend the Member for Totnes (Mr. Steen) said, the CFP does not take account of what is really happening. We have no idea of the amount of discards. By scrapping quotas, the incentive to discard and land black fish is eliminated.
	In Norway and Iceland, discards are banned. We would go further and make landing of all commercial species mandatory, as happens in the Faroes. The CFP cannot succeed, because discards and black fish mean that there are no accurate data. Much of the existing data are out of date. Accurate data must be the basis for more rational management decisions. We would follow the lead of the Faroes, Iceland, the USA and Norway and establish substantial permanent and temporary closed areas. The closed areas of New England alone are as large as the state of Massachusetts.
	We would insist on the use of selective gear. It is criminal that we allow haddock stocks that are at a 30-year high to go to waste in the North sea to protect cod. The centre for conservation sciences at Manomet in Massachusetts has achieved 81 per cent. separation of cod from haddock, and 90 per cent. separation of cod and haddock from flat fish. By raising the foot rope in the whiting fishery, it has achieved 100 per cent. separation of cod from flat fish. Only yesterday, I spoke to a senior executive at Marks and Spencer, which has a line of haddock. In trials, a cod by-catch of only 5 per cent. has been achieved by using intelligent, scientific gear.
	The Minister was recently humiliated by the Commission's refusal to listen to him about the slaughter of dolphins through pair trawling in the south-west. He was right to try to raise the matter but he was sent packing because we do not have national and local control. If we had such control, we would ban pair trawling out to 200 miles and we would work with Manomet and other excellent institutions such as the brilliant Sea Fish flume tank in Hull, where I spent a happy day on a trawling course, and devise a solution for separating dolphins from bass.
	To monitor days at sea, we would make vessel monitoring systemsVMStracking mandatory on all vessels. As in the Falklands and Iceland, we would expect instant radio reporting of untoward events such as unexpected numbers of juveniles or by-catch. In Iceland, a fishery can be closed in a couple of hours by radio broadcasts if a vessel has rung in to announce an excess number of juveniles. Let us compare that kind of reaction with the way in which the common fisheries policy is run: we have one meeting a year, whereas the Falklands and Iceland are running their fisheries in real time, on real information.

David Drew: Obviously, when the Select Committee considered the matter, we had quite a debate about putting people on ships to inspect what was being caught. Would he go as far, particularly in relation to foreign vessels, after the agreement that he would have to negotiate, as to say that there should be people put on ships, at least on a random basis, to see exactly what they are catching?

Owen Paterson: Absolutely. The problem with putting observers on ships is that it is expensive, but it has worked extremely well. In Bergen, Norway, I was told on Tuesday that in the Barents sea, one observer will be on one boat, among, say, eight or nine Russian boats in the joint zone. He will keep a close track of what is happening on the one boat that he is on, and then make a comparison with the landings recorded by the other Russian ships. Earlier in the week, talking to John Barton, who runs the fishery in Stanley in the Falklands, I found out that it has a similar system with the hake fishery. It will have one observer on one of the Korean boats, who will watch closely what the surrounding ones are doing. The hon. Gentleman's suggestion is therefore good, but the problem is that it is expensive.
	One last case that shows the ludicrous state to which regulations have brought some people is that of Paul Joy in Hastings, whom I met three weeks ago. He runs a small vessel under 10 m. Neither he nor his vessel have a quota for cod. He takes his cod as part of the inshore fleet allocation. Although that was not fully taken up last year, DEFRA is prosecuting him for going over quotawhich he does not haveon the basis of an arbitrary decision to break the quota down into monthly allocations. The whole case is utterly absurd and an outrageous waste of public money. We would make fishing regulations subject to civil, not criminal law, and would therefore decriminalise fishing. It is wrong that those who risk their lives at sea should also risk being turned into criminals by petty regulations.
	I shall describe those ideas in greater detail soon when we publish our Green Paper, which will set out our proposals for running a successful fishery under national control. I look forward to receiving comments from all parties.

David Burnside: On the hon. Gentleman's point about a Green Paper in which a national policy for fisheries will be outlined, will the Conservative party, should it become the national Government on 5 May next year, try to make the reform of fisheries policy coincide with the anniversary of our greatest ever naval victory, the battle of Trafalgar, on 21 October?

Owen Paterson: That is a splendid idea. We said that we would raise the issue at the first Council, but whichever is earlier, perhaps we can celebrate our success in October next year, on the next anniversary.
	I must conclude, as other Members wish to speak. I look forward to receiving comments on our paper, which we will produce soon. I repeat that we believe that the CFP cannot be reformed. Only the Conservative party can return Britain's coastal communities to prosperity, and its marine environment to health, by establishing national and local control, to 200 miles or the median line.

Austin Mitchell: I woke with a shock last Friday morning to find how near to Christmas we are. It must be near Christmas, as we are having a fishing debate. I want to express the concern of fishing Members that we have only this short debate, crammed inin this hole-in-the-corner fashionat the end of a day of very serious and heavy business. Fishing deserves better. It is interesting that fellow Members, enthusiastic as so many of them are about Europe, have spent so much time trying to tease the Conservative spokesman on the policy of withdrawal, which I think is an eminently sensible policy. Without wasting any more time on the issue, it might be sensible for my hon. Friend the Under-Secretary of State for Environment, Food and Rural Affairs, who I know is an enthusiastic pro-European, to use the opportunity presented by the Conservative party committing itself to withdrawing from the common fisheries policy to go to the negotiations in Brussels quaking with terror, saying, This firebrand spokesman for the Opposition is going round the port rousing the fishermen to a policy of withdrawal. You must give us further concessions so that we can beat off this threat. That would be a sensible negotiating approach

Ben Bradshaw: First, let me reassure my hon. Friend: I think that I would be correctly described as a pragmatic rather than an enthusiastic European. Secondly, let me tell him that I do not need to point out to the Commission that the United Kingdom is unique in having a main Opposition partyand, indeed, one or two other partieswith a policy favouring withdrawal from the common fisheries policy.

Austin Mitchell: Nevertheless, it is sensible to publicise the anger of fishermen who feel, rightly in my view, that this country has not had and is not getting a fair deal from the CFP.
	I have another reason for deploring the shortness and lateness of the debate. We are, I hope, at a turning point in Europe. We have certainly reached a conservation crunch, but I think we may also see an end to the panic measures that have dominated up until now. The Government's strategy unit's investigation will be important to the industry: it will, I think, constitute a prelude to change and will point us in new directions, although the Government have not yet accepted responsibility for investment in the industry. It is an important new beginning, in any event. At this time of change we deserve more time for discussion, perhaps both before and after the negotiations. We need a major fishing debate.
	Will the coming discussions in Brussels mark a new beginning there? We have a new Commissioner, Joe Borg, who does not have a second job and who I hope will bring a more relaxed approach to the common fisheries policy. It must be said that during his last couple of years in office Commissioner Fischler, accustomed as he was to devoting most of his time to negotiating on the common agricultural policy and to bullying, bashing and acting tough, tended to apply the same tactics to fishingwhich, being a much more complex industry, needs nurturing and support rather than bullying.
	To an extent, that attitude continued as fishing moved into a conservation crisis caused, essentially, by the CFP itself. The CFP presents itself as a conservation policy, but it is not. It is a political policy whose purpose is to dole out catches and satisfy as many people as it can, which leads to overfishing. When overfishing generated a conservation crisis, the European Union resorted to panic measuresdraconian and ill-considered panic measures that all too regularly had to be chopped and changed. That required new legislation, and months spent tinkering with it to bring it up to scratch. We have seen 60 per cent. reductions in total allowable catches, and an increase in mesh size to 120 mm. Huge areas have been closed for cod conservation. I hope the Minister will accept that it is possible to relax some of those measures.

David Drew: My hon. Friend clearly shares my scepticism. Does he agree that one of the biggest problems of the CFP is that it has done nothing about industrial fishing? We have all these wonderful quotas and controls, and the system is supposedly there to deal with conservation, but outside it nations are ripping the heart out of our marine environment. I know that my hon. Friend feels strongly about that, but I thought he might want to comment on it.

Austin Mitchell: I am glad that my hon. Friend has made that point. There is still a substantial by-catch in industrial fishing. Danish industrial fishermen have been found to be catching white fish on a considerable and damaging scale, and the practice continues despite all the efforts of most other fishing nations and continuous condemnation that is echoed in every fisheries debate in the House. It is a scar on the face of the common fisheries policy, and it should be stopped.
	On the need to relax some of the draconian measures, the calculations of the International Council for the Exploration of the Sea are based on fairly old science, dating from 2003, and make no allowance for the huge reduction in our fishing effort, particularly in Scotland but also in England. Nor does it allow for the improvement, as has been pointed out, in the availability of haddock and monkfish. Yet instead of looking forward to a relaxation of such measures, the first indications are that policy is going to be tightened.
	The Commission is talking of designating closed boxes in areas in which 60 per cent. of cod is taken, including a spawning ground just off the Yorkshire coast. I should make it clear that the industry supports such closures, but not ill-considered, ill-defined ones that are imposed as a panic measure. Closures need to be made in consultation with the industry, which has practical experience of what is happening in such grounds. The industry certainly deserves to be consulted, and I hope that my hon. Friend the Minister will oppose this substantial use of closed boxes. I hope, too, that he will ensure that cod conservation areas will be policed by way of licences to go in and take cod, rather than licences to go outside and take something else. The latter approach seems a very strange and anomalous one.
	I also hope that there could be some relaxation of the time-at-sea limitations. I remind the Minister that if the Government are not going to support the industry financially, they need to allow it to be as profitable as it can be in the current straitened circumstances. In other words, it needs more time at sea to make itself more profitable. But above all, we owe it to the industry to ensure more stable management routines. As the fishing organisations pointed out to us this morning, the indication in the summer was that a more consultative approach would be taken, and that the Commission would be more flexible and would produce an outline agreement in October, so that everybody could be involved in the process.
	Here we are in December and it is just like old times: we do not know what is going to happen or what the proposals are, and the figures have not been pencilled in. How can an industry that needs to move towards a sustainable future, and which needs investment and a sustainable employment pattern, plan ahead in these circumstances? It seems that a hard core of officials in the Commission want to carry on ruling by diktat and control. They do not trust fishermen, so they want a tightly regulated industry. Hence the talk of designating closed boxes, of effort limitation in the western channel in respect of soleunnecessary, according to the fishing organisationsand of further restrictions in the Irish sea.
	We want a sustainable industry that can think ahead and invest ahead, and which can provide steady employment prospects, rather than being subject to sudden changes in policy. In the past couple of years, it has borne the brunt of cutsmade necessary by the conservation crisisthat the common fisheries policy itself imposed. Yet other countriesFrance, Ireland and Spain in particularare still building their fleets. That building process is supposed to stop at the end of this year, but it is still going on. While we are drastically cutting our fleet, others are still building theirs in order to inherit the future. The industry needs a level playing field with our European competitors. It needs a level pattern of enforcement and the confidence that enforcement is as vigorous and effective there as it is here.
	We have been told that we face a further run-down by the strategy unit, but it is unreasonable to expect the run-down of the industry to happen unless it is managed and financed by the Government. Part of the original plan proposed by the World Wildlife Fund stressed the importance of investment in getting the industry from position A to an improved position B. It was about investing in the future. The strategy unit did not opt for that, but it should have.
	We face a real problem now and the threat to the English industry, particularly on the east coast, is serious. It looks as though one whitefish port is going to have to close. The threat is there and if it is going to be carried through with confidence, there must be proper management decision-making and compensation arrangements. If licences and entitlements are flowing out of the area to other areas that are doing better, we should try to keep them in order to maintain the essential critical mass that the industry needs to be viable. There must be some financial support for keeping the licences in the area.
	I understand that the Minister is strongly concerned about stability and we all agree on the need for it, so I am sure that he welcomes, as I do, the establishment of the regional advisory council. In passing, I want to say that I am still not reassured about how regional management conflicts with exclusive competence. We need to look into that matter very seriously.
	We all welcome the working group on demersal stocks, that the regional advisory council has set up. It produced an excellent report, that points the way forward. For too long, fishing in this country has been ignored by the Government, only to be restructured by liquidation when the British Government avoided responsibility. Under the Fontainebleau agreement, they would have had to make a major contribution, but they did not want to finance it. The Government did not draw on European funds in the way that applies to some other European countries, but they did not provide an alternative either. As far as the industry was concerned, it was a double whammy. That was the position in this country, and it was subsequently replaced by a system of draconian decisions from a panic-stricken Commission, desperately trying to clear up the mess that it had created.
	I have every confidence in the Minister's commitment to stability, stable management and moving towards a sustainable future. I hope that, in the forthcoming discussions, he will begin the process towards achieving that. We want an industry that works and the Minister is trying to develop thatall credit to him and all power to his elbowin consultation with the scientists. It is important to exchange points of view so that the two sides can understand each other. The gap between them has often been a crying shame. The industry should be brought into the regional management structures.
	The fishing industry must be listened to by the Commission and the Government. We must have co-operative management of fishing. For too long, it has been a hunting industry and it is crucial to bring it into a process of co-operation and consultation if we are to achieve the sustainable fishing future that we need. If we can work towards that goal at the forthcoming talks in Brussels, we may be able to stave off the worst of the threats of more draconian management from the Commission. We may then be able to start the turn-around towards the sustainable future that we all want.

Andrew George: May I apologise to you, Mr. Deputy Speaker, as I have in writing to Mr. Speaker, for the overlap in my diary, as a result of which I was detained for the first few minutes of the Minister's speech? I mentioned it in person to the hon. Member for North Shropshire (Mr. Paterson) and I am grateful to you, Mr. Deputy Speaker, and to others for their forbearance.
	I join other hon. Members in saying that it is traditional and appropriate in the annual fisheries debate that we acknowledge the hundreds and thousands of fishermen who risk their lives to put fish on our dinner tables and pay respect to the men who have lost their lives in recent times.
	The debate has ranged wide. It is appropriate that, before he attends the Council meeting just before Christmas, the Minister should understand the strength of feeling in fishing constituencies about the issues with which he and other Ministers will grapple. It is frustrating that we have had some indication of what the proposals will beI understand that they will be published on 8 Decemberbut that we do not know for sure. We are, in a sense, arguing in the dark.
	There were two sides to the speech made by the hon. Member for North Shropshire (Mr. Paterson). One side, which was helpful and constructive, dealt mainly with technical measures, the absurdity of the mesh sizes for some fisheries and the need to adapt measures to take account of those absurdities. He referred to the way in which decisions have been made in the past about mesh sizes, especially in mixed commercial fisheries. I commend him for the comments that he made, and I hope that the Minister was listening.
	In the other side of his speech, the hon. Gentleman put a little more flesh on the bones of the Conservative party's fantasy policy of withdrawing from the common fisheries policy. He said that it would be the intention of a Conservative Government to negotiate their way out of the CFP. It is extremely unlikely that they could do so. I wonder whether he would ask fishermen around the coast to bet their boats on the Conservatives' succeeding if they were given the opportunity to attempt to negotiate their way out.
	The only other alternative would be to breach the accession treaty of 1972 or to seek a derogation. We could not obtain a derogation because the decisions were, as the hon. Member for Banff and Buchan (Mr. Salmond) rightly said, made by the Conservatives and at that stage they felt that the fishing industry was largely expendable in the wider context. However, I came to politics and to this issue in 1997, and I have to deal with the world as I find it. I would not necessarily have started from here, but we have to be pragmatic and ensure that we do not commit a cruel hoax on the fishing industry by offering a policy that is clearly unachieveable.

Owen Paterson: Will the hon. Gentleman give way?

Andrew George: I will gladly give way in a moment. Perhaps when I do so the hon. Gentleman would like to address the question. Although he said that the regime would be better and that the outcome for other EU nations would be beneficial if the UK withdrew from the CFP, the fact is that it may not happen. As the Conservative Government found with the Merchant Shipping Act 1988, Factortame came along, and it was an extremely expensive process for the UK. Tens of millions of pounds were expended on pursuing what was largely an ill-thought-out policy. If we were to do what the Conservatives propose, the potential cost to the UK taxpayer would be manifold compared with the cost in respect of the Merchant Shipping Act.
	I hope that if the Conservatives introduce the policy and a White Paper they will have done the costings, because it is important that we fully understand the implications.

Owen Paterson: I repeat that this is an issue of political will. We have decided that this activity is unsuited for direction at continental level. We have followed the policy since 1972the final details were, of course, endorsed by the Wilson Government, who renegotiated the dealbut it has not worked. We have looked at other areas where successful fisheries thrive, because the measures that the hon. Gentleman admiresclosed areas, mesh size and otherscan be imposed only with national overall control. That is not a hoax: it is deadly serious. We believe that the European Union is in a constant state of flux and, when one exercises political will, as the French and the Germans have done on the stability pact, one can get results. It is not a zero sum game; the other fishing nations would benefit because we would manage our stocks far better than the CFP does at present.

Andrew George: The hon. Gentleman takes a brave and optimistic view, but I do not think that anybody who is seriously concerned about the future of the fishing industry is engaged in that way.

Alex Salmond: It is certainly true that we would not have to repatriate fishing if the Conservative party had not expatriated it in the first place. I served on the Committee that considered the Merchant Shipping Act 1988 and tabled a series of amendments warning the Government of the day of the consequence of their policy. If they had based their policy on the residence of the crew, as opposed to the ownership of the vessel, it would have had an excellent chance of coming to fruition. It was an obsession with ownership, as opposed to any interest in where the crew of fishing vessels might come from, that undid that policy and resulted in the many tens of millions of pounds of damages that were eventually paid to Spanish fishing vessels.

Andrew George: I am grateful to the hon. Gentleman. With the benefit of hindsight, those who want to go into that issue may be able to learn lessons from that intervention. I have not had the benefit of the experience of the hon. Gentleman, but I am not sure that his interpretation of what would have followed is necessarily right.
	The hon. Member for North Shropshire said that the issue was a matter of political will, but the Major Government made it a matter of political will to take on Europe over the beef ban. Of course, we all know what happened on that occasion. One can have all the political will and optimistic outlook in the world, but it does not necessarily mean that one will winor achieve a better outcome for the UK fishing industry.
	The Minister said that he was likely to disagree with the Commission's proposals on several stocks for example, on sole in western area VII. The hon. Member for Great Grimsby (Mr. Mitchell) also mentioned that. I hope that the Minister will argue strongly for a review of the proposals from the Commission, as we understand them. Both the UK and French Governments, as well as the UK and French industries, are coalescing around an agreement that I hope will win the day on 21 December, because that would be helpful. I hope that within that we will have an agreement to increase mesh sizes for that stock, because of concern about the impact on the year classes.
	The hon. Gentleman also mentionedI am sure that others will also do sothe potential severe impact of the Commission's proposals on North sea cod. I am sure that the Minister will know that the UK, through the decommissioning scheme and other efforts, has substantially met the target of 65 per cent. effort reduction. I hope that in the negotiations the UK will therefore be in a strong position to argue for a beneficial outcome for UK fishermen in the North sea.
	The Minister also knows that the science on monkfish has never been accurate. The margin for error in the scientific advice is very wide, and the Minister recognised the need to revise the science and increase the quota for monkfish in area VII during a catch year. I hope that he will bear that in mind when he is negotiating the outcome for monkfish in area VII.
	I am delighted that the North Sea regional advisory council has met and I hope that the Irish Sea and the Western Approaches councils do so soon. Having spoken to some of the people involved in that meeting, I know that they want those advisory committees to take a proactive rather than a reactive role in their relationship with the Commissionto set the agenda for policy and enforcement in those regions, rather than merely to respond to the Commission's proposals. Some people suggest that the regional advisory councils should be de facto management councils. I strongly endorse that and hope that the Minister will do all he can to ensure that they operate in that way, as many of us want.
	There is significant disquiet about the precipitate way in which closed areas have been defined. As the Minister knows, for many years there has been agreement in the industry about a closed area in the Trevose head region of the Bristol channel, but that has taken a lot of scientific work and discussion with the industry. There is concern that the co-ordinates for the closed areas of the North sea have been somewhat snatched at rather than carefully considered and subjected to consultation. Although we want to pursue a closed areas policy, and to put a greater emphasis on that type of approach, it is important that proposals are soundly based.
	On UK matters, the Minister has largely endorsed the proposals in the Bradley report for a significant change in the role of sea fisheries committees in England and Wales and their amalgamation. Will he clarify his views on that point? Sea fisheries committees are a classic case of If it ain't broke, don't fix it, certainly in my constituency area. There are separate committees for Cornwall and the Isles of Scilly, which work extremely well and are appropriately intertwined with the industry. There is good partnership in the area and the byelaws that the committees draw up can be closely and carefully inspected, due to the local nature of the committees' operation. I hope that the Minister will consider those issues carefully rather than rushing headlongI hope he will notto endorse and implement some of the proposals in the Bradley report.
	I was disappointed that the Queen's Speech did not mention a marine Bill. Although such a measure would deal with many aspects apart from fisheries, many people in the industry, as well as those concerned about the marine environment, would like some consolidating legislation. That includes the sea fisheries committees, which largely operate under laws passed in the Victorian era. Such legislation needs both updating and consolidation, so I hope that the Minister will take that point on board and that there will be proposals for a marine Bill to bring all those aspects together in the not-too-distant future.
	I congratulate the Minister on bringing in the welcome ban on pair trawling in the 12-mile zone from the beginning of November. I encourage him to continue his negotiations with his European counterparts, especially the French, over pair trawling in the western waters and the channel. I know that the French deny that their industry has a significant dolphin and cetacean by-catch, but I have spoken to several academics working with Brest university who are confident that there is sufficient evidence to show a connection between the French pair trawling industry and strandings on the west Breton coast. I hope that the Minister will look carefully into that matter and press it home very hard indeed.
	The Minister will also be aware that, around some coasts, there is a strong argument for the establishment of voluntary codes with regard to gill nets and cetacean by-catches, particularly of the harbour porpoise. I am pleased to say that, for example, in the Cornish fishery, significant progress has been made in Mounts bay and St. Austell bay, where the voluntary code that has been established between the wildlife trust and the industry is working well.
	Some important issues have been raised in the debate today. Obviously, we are concerned as Members of Parliament that we have been given an opportunity to debate these issues before we have seen the Commission's proposals. I hope that the Minister will consider allowing us a further opportunity, either later this month or early in the new year, to review the decisions made, so that we can make further progress. I hope that the Minister will take those issues on board.

Eddie McGrady: I wish to associate myself with the Minister's remarks regarding the tragedy of Colin Donnelly, who was one of my constituents, as well as the other fishermen throughout the UK who have lost their lives. Indeed, slightly earlier, three generationsgrandfather, father and sonwere lost in one incident in my constituency. It was one of the greatest tragedies that I have ever known, and it highlights the horror that can result from the unpredictability of earning one's livelihood at sea.
	I shall resist the temptation to enter into the international debate about the CFP and various other things. I simply wish to concentrate very briefly on a couple of matters that directly affect the negotiations that are about to take place and that will impinge on the fishermen of my constituency and the North Down constituency from January nextjust a few weeks away.
	First, I should like to deal briefly with the total allowable catches and the quotas. It seems from the information that I have received that the jury is still out on what is happening to Irish sea cod, whiting and haddock, but we would like to be assured that improvements will result from the negotiations. However, for plaice and, to a lesser extent, Irish sea sole, the scientific evidence has reversed. Whereas last year the evidence indicated a serious decline in the number of plaice, the same scientists now say that it is on the increase. Therefore, I should like the Minister to take that on board when he negotiates the TACs and quotas for that catch.
	The most important catch on the County Down coast that I represent is nephrops. That catch has reduced in real terms over the past four years by 24 per cent.almost a quarterbecause of the quota system. It has been reduced from 23,000 tonnes to 17,500 tonnes. The reduction was introduced not because of a scarcity of nephrops, or prawns, but because of the allegation that there was a considerable by-catch of Irish cod. I wish to say two things about that.
	First, fisheries scientists now estimate that the prawn stock in the Irish sea is three times the size that they had previously estimated. Secondly, as a result of the DEFRA-sponsored fishery science partnership, observers on local vessels have indicated and proven that the by-catch, particularly of cod, from the nephrops fishery is, in their terms, minimal. In view of those two factors, will the Minister ensure not only that there is no further reduction in the TAC or quotas for nephrops in the Irish sea, but that there is an increase?
	The hon. Member for South Antrim (David Burnside) mentioned The Hague preference, which continually works to the disadvantage of Northern Irish fishermen. There has been a regime over the years whereby the Ministers in the north and south or in London and Dublin exercise a swapping process. Swapping quotas with the Irish fishing industry south of the border has proved to be beneficial. Those two fishing industries for the island of Ireland can see one another fishing. The border between them is in my constituency. Carlingford loch, which is probably the only water border, is not even a mile wide. To have one regime on one side of it and another on the other is nonsense. The Hague preference greatly militates against Northern Ireland fishermen in that respect.
	At last December's round of talks, the Council introduced effort control at sea. Northern Irish fishermen were given additional days at sea to compensate for the closures. It is our understanding from the European Community that they will not get those additional days if there is a closure this year. We are also getting indications from our spies at the EC that if the Minister presses strongly enough and negotiates hard enough, we will get those additional days if the closure restrictions are introduced. I leave him with that thought, to gird his loins for that negotiation.
	The Irish sea cod closures are now into their fifth year. There have been all sorts of effort controls, including additional technical conservation measures, fishing vessel decommissioning and a plethora of presumably laudable and necessary restrictions on catch. However, there is no evidence of those having any meaningful effect in restoring stocks. Local fishermen are wondering whether over-fishing is causing the problem or whether environmental change is a primary factor in the decreasing stocks of particular species in particular areas, which has been discovered in fishing areas outside the UK. Perhaps the Minister will take that on board in his review.
	I like to think that the Minister will, in the remaining time before he sits down at the negotiating table, consult more intimatelyif that is the right word to usethe Northern Ireland fishing organisations. There is an opinion that they were excluded from the higher echelons of consultation for the first time, in 2004. They have always had a close relationship with the Fishing Minister in the north and the Fishing Minister in Westminster.

David Burnside: I am sure that the hon. Gentleman is aware that our representative, Mr. Alan McCulla, will be at Westminster next Tuesday, giving evidence to the fishery Sub-Committee of the Environment, Food and Rural Affairs Committee, representing our interests. We hope that that evidence will be passed on to Her Majesty's Government.

Eddie McGrady: I thank the hon. Gentleman for that information. It would be a great thing if the Minister, who will be the key person at the negotiating table, takes the opportunity of the Irish fisherman's presence here to give him an interview and discuss matters with him. That would be most laudable.
	I end with words of exhortation on behalf of the fishing fleet in Northern Ireland. Communities such as Kilkeel and Ardglass, the primary ports in South Down, and Portavogie in North Down depend on the fleet. Not only is the fishing industry dependent on the catches and the markets, but whole communities are built almost exclusively on the fishing industry and fish processing. The fleet is vital to the economy of my constituency and the industry as a whole in Northern Ireland.

Alex Salmond: It is a great pleasure to follow the hon. Member for North Down[Interruption.] I am sorry. It would have been a pleasure to follow the hon. Member for either Down, but it is certainly a pleasure to follow the hon. Member for South Down (Mr. McGrady). I will follow his example by spending the latter part of my speech on specific practical matters. The Minister said that he was a pragmatic Fisheries Minister; I am a pragmatic Opposition Member, and my uppermost concern in these debates is the immediate issues that face my constituents and the industry that depends on the catching of fish. I shall devote some time to the politics, but I will want answers to my specific points.
	I do not agree with Members who have suggested that this is the wrong time for the debate. We have a very good idea of the proposals that will come forward. We know what the Norwegian talks have thrown up and we know, roughly at least, what the Commission's proposals might be. In so far as the Minister chooses these things, he has chosen the right time for the debate. I hope that he will keep us informed as the talks go on. The hon. Member for Orkney and Shetland (Mr. Carmichael) made an excellent point, and perhaps the Minister will even prevail on the Leader of the House for a statement as the talks progress. Would it not be interesting if the subject of fisheries was considered important enough to have a statement on the Floor of the House? The Minister could inform us of progress, and we could have a debate.
	I am sure that the Minister will want to provoke a debate on the outcome of the negotiations. This year I provoked a debate in Westminster Hall to examine the unintended consequences of last year's fisheries discussion. I hope that we will not have the same unintended consequences this year, but it is important that the Minister, having chosen the right time for this debate, keeps us informed on the progress of the negotiationsI know that he will be anxious to do thatand comes back in January for a debate on their outcome. It is time that we accorded the subject the importance that it deserves.

Lawrie Quinn: Does the hon. Gentleman recall that, probably two years ago, we had a very useful and encouraging debate in a European Standing Committee? Members representing fishing communities were better able to scrutinise the outcome of European talks. Is not that format, which allows for debate and a vote on a motion, the best for allowing us to discuss the meat of the decisions that will probably be made?

Alex Salmond: Like the hon. Member for Great Grimsby (Mr. Mitchell), I have been at every fisheries debate on every occasion, stretching back for many years, and I remember that debateprecisely because I noted that the Minister disparaged the common fisheries policy and said how much he disagreed with it. I think he will find that on the record; I do not see him demurring. It was a useful debate, and of course, he opposed the policy only in a pragmatic sense in that Committee. None the less, he was right to do so. I shall remind the House what is wrong with a policy that has served us so badly over the past 30 years or so.

Michael Weir: My hon. Friend mentioned the unintended consequences of last year's deal. Does he realise that they still have repercussions for our fishing communities? For example, it was discovered halfway through the period that the port of Arbroath was not a designated port for haddock landing. The Scottish Executive then said that it was designated, but it turned out that it had not been properly designated. That has caused utter confusion in the fishing industry, and the same applies to small ports throughout Scotland.

Alex Salmond: I remember going with my hon. Friend to see the Fisheries Minister, and I know that he was keen to see the designation of a number of ports. I am unhappy to hear that Arbroath was not properly designated; it should have been. It is a vital port, and the industry that flows from the fresh haddock catch there is also important.
	The unintended consequences illustrate the nature of the common fisheries policy. If the Minister goes to negotiations, as he did last year, and is suddenly confronted with a range of maps and devicessome of which had not been seen before and had certainly not been consulted on with the fishermen themselvesthe negotiations are bound to produce unintended consequences, which is the euphemism for their effects on people trying make their living. For the communities that depend on the catches, they are a disaster.
	That is no way to run a fisheries policy. The CFP is inherently flawed, because it does not confer a sense of ownership. Any resource policy needs a direct form of ownership, without which there is only a loose incentive for conservation. Any fleet under pressure will decide that if it does not catch the resource, another fleet will do so, and deplete the resource. The result is competition between fishermen in an essentially competitive industry, and competition between fleets. Without a common thread of ownership, fisheries policy is deeply flawed.
	The CFP is the only attempt at common resource ownership in the European Union. I noted that, in the Chancellor's statement today, oil revenues came to the rescue, enabling him partly to fill the black hole in his calculations. Unfortunately, the Prime Minister is busy spending that largesse on wars, and the Home Secretary wants to spend it on identity cards. None the less, oil has come to the rescue. Can hon. Members imagine what would happen to the Chancellor's already furrowed brow if the EU declared that oil was to be an exclusive competence of the European Commission? Instead of the revenues coming to the aid of the Chancellor, they would go to the aid of the Commission. There would be explosions at the Dispatch Box if such a suggestion were made about the oil resource, but that is what was given away in the resource of marine fisheries 30 years ago.

Richard Bacon: That was disgraceful.

Alex Salmond: Indeed. It was disgraceful that the Conservative party permitted it.
	The modern Conservative party says that that was in the Heathite years of the past. Things are entirely different now, apparently, and fishing would merit a much higher priority. However, the Benches behind the hon. Member for North Shropshire (Mr. Paterson) are empty, so I wonder about that priority. I commend the hon. Member for South Norfolk (Mr. Bacon) for coming to the Chamber to hear me speak, but he should have been here to hear the hon. Member for North Shropshire, who gave an interesting speech.
	I have been doing my sums, and the leader of the Conservative party has had just over 200 opportunities to ask about fisheries policy at Prime Minister's questions, but he has not managed to ask any questions to datenot one. He will probably ask one next Wednesday, but it is remarkable that he has not yet done so. However, I do not doubt the honesty and integrity of hon. Member for North Shropshire, partly because the Deputy Speaker would not allow me to do so, but also because he has visited more fisheries ports and fisheries regimes than I have had fish suppers. However, the good intentions of many Opposition spokesmen and Fisheries Ministers have been laid to ruin, because when push comes to shove, they realise that fisheries policy in the United Kingdom does not have any priorityand never has had under successive Governments, as the hon. Member for Great Grimsby and I have realised in the fisheries debates that we have sat through. I can see that the hon. Gentleman is nodding freely.

David Burnside: Given the auld alliance between Scotland and France, can the hon. Gentleman extend that comparison? Presidents and Prime Ministers intervene on behalf of the French or Spanish interest in those discussions in December every year. That happened last year, but when was the last time a British Prime Minister intervened to back up his negotiating Minister?

Alex Salmond: President Chirac, of course, threatened to go to the negotiations if the French did not get their way, but concessions were made. The Prime Minister made a phone call to Herr Fischler. I thought that I could recruit Rory Bremner to make half a dozen calls and make fisheries a much greater priority. However, there is a serious point to be madeno British Prime Minister or Government have made fisheries a priority. One remembers the chilling words of the civil service memo released under the 30-year rule:
	In light of Britain's wider European interests they
	the Scottish fishermen
	are expendable.
	Incidentally, that was not a civil servant saying that Scottish fishermen should be expendable. It was a civil servant in the then Scottish Office commenting on the negotiations and bitterly assessing the attitude being adopted by the Prime Minister of the day, the negotiators and the Foreign Office. I believe that that remains the situation.

Michael Jabez Foster: Is the hon. Gentleman aware that the Prime Minister has set up the strategy unit on fishing, which has now reported? This is the first time, perhaps for decades, that the fishing industry has had such a targeted approach from No. 10.

Alex Salmond: Of course I am aware of that. I welcome the hon. Gentleman to a fisheries debate. If he came to more of them, he would know what I am aware of. The Prime Minister's strategy unit was somewhat flawed by its inability to count the vessels in the Scottish fishing fleet. We would have had more confidence in the strategy unit if it had been able to count the number of boats that we have, never mind forecast the decline, which it then projected forward. That caused huge irritation in Scotland.
	I was interested in the debate in the European Fisheries Committee, which by 24 votes to nil, with four abstentions, attacked the exclusive competence of the fisheries policy in the proposed European constitution as anomalous and unjustified. Two of the Portuguese members of the Committee wanted to go further in their amendments. The impression given by the Governmentthat everybody else throughout the European Union is comfortable with the fisheries policy, and it would be an impossible negotiation to try to get something fundamental done about itis misleading. There is deep dissatisfaction in many member states with that policy of despair for many, many fishing communities across Europe.

Angus Robertson: Does my hon. Friend agree that one part of the debate that is often missed is the fact that the draft European constitution, with the exclusive competence on marine and biological resources under the CFP, could act as a disincentive for fishing nations now outside the EU to join? Does he believe that countries such as Norway and Iceland will ever join the EU if a constitution with such a provision is passed?

Alex Salmond: The point is well made. I do not think there is any chance of Norway, Iceland or the Faroes joining the European Union if the Union tries to maintain exclusive competence over fisheries. If we look at the European constitution, we can see just how ridiculous the position is. There are four exclusive competences in the EU, in addition to the competition laws necessary for the single market to which Lady Thatcher signed us up. The first three are the customs union, which was the very foundation of the Common Market; common commercial policy, without which there could not be a European Union; and monetary policy, for member states whose currency is in it. The Government, who criticise others for wanting to opt out of the common fisheries policy, are happy to continue almost indefinitely opting out of monetary policy, which seems to me slightly more fundamental to the future of the EU than the fisheries policy. Lastly, there is the conservation of marine biological resources under the common fisheries policy.
	That is ridiculous. It is an anomaly from the past, dating from when the competence was signed away in 1971. There is massive dissatisfaction, and if there had been an ounce of political muscle in the negotiations, making fishing a priority, it could have been removed from the list of exclusive competences. The great benefit of that would be that when the Minister spoke about regional advisory committees becoming management committees he would have some basis for the argument, because even the doctrine of subsidiarity does not apply to the exclusive competences of the European Union under the constitution. We would be in a much better position.
	I shall have many chances to argue those points further in connection with my Fisheries Jurisdiction Bill, which I intend to reintroduce. I am grateful to the many hon. Members who supported it, and I understand that more Conservative Members would have supported it if I had not argued for national control for the nations of the UK. I hope, however, that they will overlook that aspect and that there will be even more support for the Bill when I reintroduce it.
	I want to ask the Minister some pragmatic questions that are important to my constituents and those of other fisheries Members. We have heard from a number of hon. Members about the prawn fishery. The obvious conclusion that we must draw from the new scientific examination of the prawn stocksin some ways, it is the first proper such examinationis that they are massively greater than has hitherto been suspected. The quota increases suggested could be called niggardly in comparison, and a fundamental re-evaluation is needed.
	Of course, one of the reasons why prawn stocks are so healthy is that the cod are not eating the prawns. In a complex marine fishery, the interaction between fish and other marine species is of fundamental importance. The Minister kindly lent me a book on the history of codI have yet to return it, but I have read it and I shall give it back to him shortly. It is relevant in this context. We have a fisheries policy that Herr Fischler, at least, was trying to run as a cod policy in which it seemed that virtually every other species in the sea had to be subservient to cod; it was a case of the ultimate one-club golfer. Unfortunately, the results are disastrous. Instead of giving people other fishing opportunities to take the pressure off cod, they were denied such opportunities and efforts were relocated elsewhere, doing damage to other species.
	The North sea is a mixed fishery, and the effort level applied in respect of the white fish fleet is a similar issue. If over-fishing explains the state of cod stocks, how can it be that we have low cod stocks in some areas, but record 30-year-high haddock stocks? There is a mixed fishery, with fish swimming in the same sea, pursued by many of the same boats, yet one stock is at a record high, while the other is low in certain areas. That tells us that there is another explanationa deep environmental explanationwhile the commissioner has refused to consider the matter seriously in any significant way.
	Haddock are at a 30-year high. If the Faroese were running haddock policy in the North sea, the quota would be 150,000 tonnes. After the Norwegian talks, we are talking about a possible reduction of the quota.

Owen Paterson: There is another point, which the hon. Gentleman has missed. The policy is self-defeating in some ways. The lesson with the Faroes is that leaving an enormous haddock stock means that haddock are eating young cod. He made a similar point when he said that prawns were not being eaten.

Alex Salmond: I am aware of that argument. The Faroes would go for about a third of biomass as a quota. Whether we go for a third or somewhat lessa third would be 160,000 or 170,000 tonnes or so, as opposed to the 66,000 tonne levelthere is leeway, which should be accompanied by a huge marketing policy. A fish processor in my constituency said that new filleting machinery technology would enable him to fulfil a contract in mid-Europe, Germany and eastern Europe involving 10,000 tonnes of haddock. Of course, he must have access to the stock. That would be fundamental in giving us a larger stock and catch, and a sustainable price, although a bit of certainty is required that such a contract can be fulfilled in the medium term. Will the Minister think about the opportunity in respect of haddock as he goes into the talks?
	I asked the Minister a question about monkfish, to which he was going to reply. Now the Commission, or at least its scientists, have admitted that their monkfish data are nonsensical. We know that monkfish are in plentiful supply and that they are a high-value stock. We are also approaching Christmas, and yet the hard-pressed boats have not been able to access that stock in the past week, nor will they be able to do so in coming weeks. It is tragic in such a fishery that North sea boats will now be diverted to other species, as they desperately try to stay in business. Yet we know that the monkfish are in substantially good condition. All the research supports that view, but the quotas have been allocated at a precautionary level, which means that they have no scientific basis. I know that the Minister is sympathetic to that argument, so will he now press to get back to the 1999 reference period levels and have a sensible allocation of effort on monkfish to allow that fishing opportunity to boats when so many other opportunities will not be available?
	I hope that in this contribution, I have managed to combine my politics, which the Minister knows, with my anxiety to see fishing treated differently. My approach is pragmatic, because I want to see improvements and gains. I have made it clear where I would like fisheries policy to go. I do not think that the Tories will win the next election, but in 2007 we will have a fishing-friendly Government in Scotland, led by the Scottish National party. In the meantime, I want to do as much as possible to protect this vital industry, which so many hon. Members love dearly and want to see thrive. It should get the sort of commitment from all politicians to which it has not been accustomed, but to which it is certainly entitled.

Bob Blizzard: I want to say a few words about long-lining, which is an environmentally friendly and sustainable fishing method. I do not believe that long-lining is responsible for the devastation of fish stocks. When my hon. Friend the Minister goes into bat for us in Brussels, whatever further restrictions may be necessary on species such as cod, will he ensure that long-liners are excluded from them, because I cannot see the harm that they do to fish stocks? Long-lining is a labour-intensive form of fishing and supports more jobs per fish caught than many other methods.
	The main reason why I wanted to catch your eye this evening, Mr. Deputy Speaker, is to follow through on a point that I made at Environment, Food and Rural Affairs questions only a couple of weeks ago. The problem concerns pay levels at the Centre for Environment, Fisheries and Aquaculture Science. CEFAS employs the scientists on whom we rely in order to hold today's debate. The Minister has kindly undertaken to look into the matter, and so that he can do so with an understanding of the scientists' point of view, I want to apprise him and the House of the current situation at CEFAS, which is highly unsatisfactory.
	CEFAS is an Executive agency of DEFRA. Its headquarters is in Lowestoft, the largest of its three sites, and it has two other sites at Weymouth and Burnhammy hon. Friend the Member for South Dorset (Jim Knight) supports my remarks. CEFAS employs 530 people, about 300 of whom are based at Lowestoft. Although the scientists do more than concentrate on fishing, we rely on them for accurate information on fish stocks, various species, factors affecting breeding, fish health and the whole marine environment. Every year in this debate, someone says, Our policies must be based on sound science. Without those scientists, we could not formulate a fisheries policy. Without the help and advice of our scientists, my hon. Friend would, in effect, go into bat in the Fisheries Council wearing a blindfold. If we respect what those people say about fish stocks, we should respect what they say about pay, which is a problem. Until a few years ago, all the scientists worked for the old Ministry of Agriculture, Fisheries and Food, and although CEFAS is an agency, its staff still work closely in partnership with DEFRA. If hon. Members table a question, and in particular a detailed question, on fisheries, it will be sent to CEFASprobably to Lowestoft in my constituencyfor the answer. CEFAS is part of the machinery of Government. It is not privatised and is not a contractor that is paid special rates for specific jobs. CEFAS staff receive different levels of pay from core DEFRA staff. For example, the difference between the minimum points on the pay scales is between 2,750 and 7,000 a year. At the maximum end of the scale, the difference is typically about 3,000 a year.
	Worse still, although core DEFRA staff can progress through those scales to the maximum of the pay band over a period of, say, eight to 15 years, there is no progression system for CEFAS staff apart from leaving the entry range after one or two years. Those scientists tread water with no hope of reaching the maximum. The pay at CEFAS is quite low. Graduates start on 15,000, while those on exactly the same grade in core DEFRA start on 21,451. Nothing highlights the problem more than that.
	When I took this matter up before, I received a reply from the Minister for Rural Affairs and Local Environmental Quality, who said in a letter dated 27 October that the agency arrangements
	enable more 'freedoms' to create the necessary degree of flexibility to allow operational accountability for the organisations delivering the service
	and give them flexibility in their pay arrangements to align them appropriately to the services that they exist to provide.
	It is said that the agency has the opportunity to go out and win extra non-Government work in the private sector to enhance its income. CEFAS knows that, and does so, but the fact remains that 82 per cent. of its income still comes from DEFRA. If one includes the other Departments that it works for, 91 per cent. of its income comes from the Government.
	CEFAS is not paid in any competitive, contractual wayit simply gets a block payment from DEFRA each year to do whatever DEFRA wants. In effect, CEFAS is part of DEFRA and has to respond as part of the civil service, so if something needs doing, it has to do itit expects and accepts that. It does not have the freedom to pay the rates that it would like. If, in a good year, it earns more income from other sources, it is not free to distribute that in a pay rise because there is a Treasury cap that means that it can do so only if the Treasury agrees to itrather a hard thing to get it to do. It cannot even plough those extra earnings back into the business in any form because any surplus has to be paid back to DEFRA.
	CEFAS is in a trap, and it is not surprising that its staff are unhappy. That is showing up in retention problems. About 70 staff have left in each of the past four years. There is a move towards a transient work force rather than the stable community of committed scientists that we need to do the job. Management recognise that they have a problem and currently pay what they call recruitment and retention allowance to 33 people, amounting to 67,000 a year in total. Of course, that creates disparities within the organisation and is not a particularly transparent method of solving the problem. That creates tensions and ill feeling, which are not good for team building.
	Staff surveys at CEFAS have shown that pay is the main problem. I am told that a review just carried out by a Mr. Ken Crossland found that pay is the most significant source of staff discontent and that the laboratory is finding recruitment and retention a growing problem. Last September, the staff held a ballot on whether to accept a pay offer. It was rejected by 91 per cent. of members of Prospect and 97 per cent. of members of the Public and Commercial Services Union. Ballots on strike action or action short of a strike came out two to one in favour of strike action. One union came out eight to one in favour of action short of striking, with the other union four to one in favour of such action. These are moderate scientists with no history of militancy; the fact that they are voting for strike action and action short of striking shows how they feel.
	I mentioned that a review of the DEFRA agencies is taking place. Will my hon. Friend the Minister use that to examine the problem of these scientists' pay and try to sort it out? CEFAS deals with intellectual property, and its success depends on the quality of people's minds. I put it to the House that troubled, unhappy minds do not make for a successful organisation.

Alan Reid: It is clear to us all that the common fisheries policy has failed. It has failed to conserve key fish stocksmost obviously codand it has failed the remote communities where fishing has long been a mainstay of the local economy. That has happened because the policy is over-centralised and run from Brussels. Decisions are made in a secretive forum that is far too remote from those who are affected by them.
	It is clear that the CFP must be reformed, and reform is the only viable option: although withdrawal might be tempting, it is not a serious option. The CFP is part of the original 1972 treaty of accession. To renegotiate that, Britain would need the agreement of all the other 24 members of the European Union. There is clearly no prospect of that. The hon. Member for North Shropshire (Mr. Paterson) claimed that it was a matter of political will. He may personally have that will, but the empty Benches behind himhe is accompanied only by a Whipshow that the Tory party does not regard withdrawal as a top priority. There is therefore no demonstration of such political will.
	Negotiation and achieving unanimity among EU members for Britain's withdrawal from the CFP will not happen. If Britain wished to leave the CFP, it would have to leave the EU. Perhaps there is substantial political will on the part of some members of the Conservative party for that, but it would have major and damaging consequences for the country. It would adversely affect our exports to the EU and the impact would be felt in industrial and fishing communities alike. Many of the prawns that are caught and landed in my constituency are exported to other EU countries. Leaving the EU would also have an impact on the investment that many of our remote communities receive from European structural funds.
	In addition, there is the problem that fish swim across national boundaries. British fishermen traditionally fish in other countries' waters, so withdrawal would have to be followed by negotiations with the EU, acting on behalf of those member states with which we had shared fisheries. We would also have to negotiate with other countries outside the EU, such as Norway, Iceland and the Faroe Islands. That would mean ending up where we started, with annual horse-trading with the EU and other countries to reach a decision. That is exactly what happens now and what is wrong with the current system.
	The reform that is required is giving genuine power to regional management committees instead of regional advisory councils.

Owen Paterson: The hon. Gentleman raises the old canard about fish swimming over boundaries. The EU creates artificial boxes, for example, cod boxes and Irish boxes. I visited Norway this week, and it has vast areas, not only off its 200-mile exclusion zone. It has Jan Mayen island and Spitsbergen. It catches 80 per cent. of its fish in shared zones because it has borders with the EU, the Faroes, Greenland, Iceland and Russia, and that works satisfactorily. However, Norway has control. That is not the horse-trading that the hon. Gentleman described.

Alan Reid: I simply do not follow the hon. Gentleman's argument. On the one hand, he says that Norway has control, and on the other he talks about shared zones and the need to negotiate. The hon. Member for South Down (Mr. McGrady) put the point well when he said that, if Britain left the CFP, Carlingford lough would be split between two jurisdictions and there would have to be further negotiations. Withdrawal from the CFP would not result in Britain's having control. We would have to negotiate with many other countries. That is what we do now. The Conservative party is arguing from a false perspective when it claims that leaving the EU would give us sole control.

Alex Salmond: There is one difference that the hon. Gentleman might like to think about. Under that perspective, we would negotiate only with countries with fishing resources. In the current context, many countries with no fishing resources whatever technically have an equal say in the Council of Ministers over fisheries negotiations.

Alan Reid: Were the hon. Gentleman leading the negotiations for an independent Scotland, which he continually fantasises will happen, he would be in a very weak negotiating position trying to negotiate with all the other countries around the North sea.

Owen Paterson: It is a perfectly sensible point. The land-locked countries that I namedSlovakia, Hungary and so onwill horse-trade their interest in fish to get benefits on agricultural matters in the Council. Norway is working closely with other maritime nations. To take the most dramatic example, the Falklands and Argentina were at war 20 years ago, but this year they worked closely together and closed down the fishery early, because the illex dropped off. That is what happens when maritime nations work together out of common interest.

Alan Reid: But the hon. Gentleman has conceded that Britain would not have sole control and would still have to negotiate. Trying to sell the idea that Britain has sole control is just nonsense.

Ben Bradshaw: I hesitate to reopen this debate, but the hon. Gentleman is making some important points. The UK would be negotiating not only from a position of isolation but from a position of having narked every other country with whom we were hoping to renegotiate, while at the same time not having any say whatever in the common fisheries policy that will govern many of the seas in which our fishermen have an interest.

Alan Reid: The Minister makes a very important point.
	I want to make some important points about my local fishery in the west of Scotland. The prawn fishery is now the most valuable fishery available to the Scottish fleet. There is universal scientific agreement that prawn stocks are healthy. It is true that, in certain areas, at certain times, there is a cod by-catch that is more than negligible. That cod by-catch should be avoided by area access restrictions at certain times of the year, rather than by quota restrictions, but as long as prawn fishing vessels avoid certain designated areas at certain times, the cod by-catch when fishing for prawns is only negligible.
	The published scientific data show that the nephrops total allowable catch for the west of Scotland could be increased by 30 per cent. without any risk to stocks. The EU's Scientific, Technical and Economic Committee for Fisheries has taken a cautious approach and advised that an 11 per cent. increase in TAC would have no adverse effect on either prawn or cod stocks. I urge the Minister, in the negotiations, to ensure that the Commission heeds the scientific advice and increases the west of Scotland nephrops TAC by at least the cautious 11 per cent. recommended by the committee.
	Another problem that is being caused to fishermen in the west of Scotland relates to the annexe V restrictions, which apply to nephrops fishermen. The Clyde Fishermen's Association has pointed out to me that those regulations cause them a great deal of problems and inconvenience, yet the benefit of the regulations to cod stocks is miniscule. I urge the Minister to try to persuade the Commission that the west of Scotland's nephrops fishery should be exempted from the annexe V regulations, which achieve nothing and cause a great deal of problems.
	In the long run, we need to move away from the annual negotiations and horse-trading in Brussels towards regional management committees, but for this year at least, we are struck with the horse-trading. The Clyde Fishermen's Association has asked me to pass on its appreciation of the interest that the Minister has taken in his consultations with the fishing community, and I hope that he will achieve in negotiations the nephrops quota increase and the lifting of the annexe V regulations. If those gains can be achieved, it will be a welcome relief to struggling fishing communities in the west of Scotland.

Michael Jabez Foster: I am grateful for the opportunity to speak briefly in what I realise is a truncated debate.
	First, I want to say a big thank you to my hon. Friend the Minister, who like his predecessor has become in all respects the fisherman's friend. Only this week, my constituents in Rye were pleased to note that some 4.7 million had been invested in a new fishing quay. The work starts this week, and bulldozers are on the site. The quay will provide a secure and improved facility for the next 50 years or so.
	Also, in both Hastings and Rye, my constituents who are employed in the under 10 m fleet in Hastings, the largest beach-launched fleet in Europe, are celebrating my hon. Friend's good sense in suspending the licensing conditions for the remainder of the year. That means that my hard-pressed constituents will have a rather happier Christmas than they might otherwise have had.
	The sensitivity shown by my hon. Friend is commendable, although I must add that concern remains about the viability of the under 10 m fleet if the current limits are retained. The limitations imposed by the quota system within the CFP are understandable, but whatever the outcome for Britain in the quota negotiations, my constituents could benefit from a different approach to how these little boats are dealt with.

Alex Salmond: Is there anything I can do to have such things bestowed on me by Santa Bradshaw? Is there any way in which I can persuade the Minister to provide such largesse for my hard-pressed constituency?

Michael Jabez Foster: I can only suggest that the hon. Gentleman should carry on voting Labour.
	Even within the context of the under 10 m sector, I can offer a third thank you to the Minister. I thank him for setting up the process whereby following the report of the Prime Minister's strategy unitas I have said, that constitutes the first involvement of No. 10 for many yearsmeetings have been arranged between representatives of the under 10 m fleet and DEFRA, in my area at least. Such dialogue will undoubtedly lead to better understanding, at the very least.
	The strategy unit report recognised the need to protect small fishing communities, notI acknowledgebecause they were of massive economic importance in themselves, but because in many such areas the wider community depends on their survival. That applies very much to my constituency. Why would one want to visit the town of Rye and its harbour if the harbour were not kept open for fishing? Why would one want to go to Hastings old town, but for the net huts and the charm of the boats on the beach? While small fishing communities are important for historic and cultural reasons, they have a wider economic value in their wider community.
	What can be done? As the Minister will know, for cod fishing purposes the eastern channel is bizarrely treated as part of the North sea. The idea of Hastings and Rye being on the North sea is certainly bizarre. Perhaps my first request should be for a more realistic attitude to the way in which the European areas are zoned: there is a particular reason for that in the eastern channel.
	My fisherman constituents firmly believe that the eastern channel is overstocked with cod. As has been said, area VIId is treated as part of the North sea for cod stock assessment purposes, and TAC cuts in the North sea apply to that area as well. However, the validity of that grouping was based on work done by the Centre for Environment, Fisheries and Aquaculture Science back in 1964under another Labour Government, true, but many decades ago. My constituents say that that historic calculation is no longer valid. They believe that the cod are of a different stock from those in the North sea, and that the eastern channel cod are particularly plentiful. Indeed, it is impossible not to catch them.
	Therefore, a fourth thank you is due to the Minister for his agreement to look again at the science relating to the eastern channel. He has now approved a new research project which CEFAS will undertake to identify and quantify the stock. I do not know how long that survey is likely to take, but I welcome the Minister's initiative and hope that the outcomes will be known very soon. If they justify my constituents' belief that area VIId should be separated, my constituents should be allowed to fish in a way that is more appropriate to the available stock. In the meantime, while the issues are under review, alternative arrangements will be necessary. It is simply impossible for my constituents to survive on the small cod catches that their current licences permit.
	For the past two years, the small boats in the eastern channel have not even caught the quota permitted for their sector, due to the over-restrictiveness of the licensing conditions imposed on their individual catches. Of course, my hon. Friend the Minister has sorted things out for this year, but we need to do something for the years to come. Incidentally, this procedure is not necessarily covered by European law. Other member states, which need only to estimate the under 10 m catch, do just that. There is no regulation requiring small limits and licensing conditions for such fleets. The Minister has therefore made a wise decision in suspending the licence conditions for this year-end period, thereby perhaps enabling the catching of something nearer the permitted quota. But does he agree that next year, it would be helpful to come up with a different scheme from the very beginning?
	As I have pointed out, a monthly limit of 750 kg for a boat with a crew of one equates to a weekly wage of 66. If the boat is unable to take its monthly quota because of the existing conditions, even that income is lost. My constituents therefore propose that the monthly allocations be scrapped altogether. The cod fishery could be left open and unrestricted until all the channel quota has been caught. It also seems reasonable that the eastern channel share of the cod quota be separately determined, given that 67 per cent. of fishermen who target channel cod are based in that area. I think that the Minister can rely on the good sense of my fishermen constituents to make the quota last through to the year's end. I certainly hope that he takes that point on board in respect of next year's arrangements. Indeed, is it really necessary to have a licensed quota at all for these very small boats?
	It is believed that the French do not rely on cod to the same extent as fishermen in the eastern channel. Although this is never an easy task, could the Minister, in this, the year of the entente cordiale, speak to his French counterparts and persuade them to surrender just a little of their unused quota?
	Finally, I should point out that my fishermen constituents have been cruelly deceived, in that they have been told that it is somehow possible to abandon the common fisheries policy, which they wish to do, without leaving the European Union. They are indeed happy to leave the EU, but I wonder whether the Minister knows of any other nation among the 25 EU nations that could negotiate abandoning the CFP without leaving the EU altogether.

Alistair Carmichael: Other Members have remarked on the fact that this is merely a three-hour debate. That is undoubtedly true, but for my constituents and for the fishing industry in my constituency, it is probably the most important three hours in the parliamentary year. I am therefore very grateful to you, Mr. Deputy Speaker, for allowing me to take part yet again in such a debate.
	Unfortunately, unlike the hon. Member for Great Grimsby (Mr. Mitchell)he is not in his place I cannot boast a long pedigree of participation in such debates. In fact, this is my fourth such debate, and I do detect a slight improvement in tone this year, and perhaps a feeling of cautious optimism among Members representing fishing constituencies. I wrote down the phrase cautious optimism while making notes during the debate, but on mature reflection it was perhaps a gross overstatement. For my part, it might be more accurate to say that I do not feel quite as pessimistic as in recent years; hopefully, that is an indication of movement in the right direction.
	Of course, such feelings might simply reflect the fact that this debate is being held at an earlier point. Come 8 December, when we know the full extent of the Commission's proposals for the industry, we might feel very differently. However, I thank the Minister for responding to my earlier intervention by saying that those of us who represent fishing constituencies and the associated industries will have further opportunities for dialogue with him and his officials.
	The Minister must be aware of the need to involve fishing industry representatives throughout the whole Council processa point discussed at the last DEFRA questions, which I want to re-emphasise today. As proposals and counter-proposals emerge, the industry's views must be sought and listened to. It is not a question of giving anyoneeither fishermen or conservationistsa veto, but the fishermen must be heard in the course of the process. If that had happened last year, I remain convinced that we would not have been left with a system that, for white fishing in the North sea, verged on the unworkable. We spoke last year about unintended consequences, and we found ourselves in June unpicking some of the unintended consequences of things that could have been done better in December. I certainly hope that that lesson will have been learned.
	The Minister referred in his speech, and it was echoed by others, to the establishment of the North Sea regional advisory council. Given that it was part of the Fisheries Council from 2001, if not 2002, it is fair to say that its establishment was long overdue. The Minister will accept that it also remains the subject of a fair degree of scepticism among the fishing industry. Having said that, I am pleased to see that it is now up and running and I take the view that the council has made a good start. In particular, its working party on demersal stocks has produced an excellent provisional opinion, to which both industry representatives and conservationists have been able to sign up. The important point is that the Commission and the member states must listen to the views expressed. If not, the fishing industry's scepticism will be felt to be justified. Frankly, I could not dispute that analysis.
	There has been concern for some time about the science and I hope that the regional advisory councils will be able to make some progress in that regard. It seems incredible that, at the end of 2004, we are still using figures that are more than 12 months out of date. The data on which next year's decisions are being made, taking us to the end of 2005, will be almost two years out of date by the time they are finished with.

Alex Salmond: I was just about to agree with the hon. Gentleman that his own optimism might be exaggerated. What does he believe would be the consequences, intended or otherwise, if the Commission were to persist with a closed area map anything like the one that we were given earlier today? What would be the consequences for his fishermen, my fishermen and fishermen round the coast? What would happen to their opportunities and what about the dislocation of effort elsewhere?

Alistair Carmichael: The hon. Gentleman refers to a map provided to us by members of the Scottish Fishermen's Federation at a briefing earlier today. As Hamish Morrison described it, closed areas would be the worst-case scenario. Fishermen in my constituency have been disproportionately affected merely because of the geography of where they are based and the size and compass of the closed areas or permit areas that they have had to work with this year. I have no crystal ball, but I know that very few positives would emerge from that particular scenario. I cannot see that it would be workable and I hope that the Minister will hear that. He certainly got that message loud and clear when he visited Shetland during the course of the summer. I shall say more about it later, but it is not just a matter of the lines drawn on the map last year, as the byzantine regulations introduced to accompany them were also significant.

Andrew George: My hon. Friend would surely acknowledge that the industry nevertheless accepts the principle of establishing closed areas. It was the speed with which the decision was taken, the co-ordinates of the North sea areas and the lack of sufficient consultation that caused the problems. Does not my hon. Friend agree?

Alistair Carmichael: It is easy to accept things in principle. However, the experience has been that closed areas, because they come as part of an overall package, have been difficult for fishermen to operate. I have argued for the principle of closed areas. I think that just about everyone who has a fishing interest has done so in some way at some stage, but if closed areas come tied up with suchI have used the word alreadybyzantine regulations, they become a nonsense. We have had the nonsense of the haddock permit system that has my fishermen in Orkney and Shetland steaming in and out of port, changing gear, and having to notify fisheries protection officers in order to get the permit. Frankly, closed areas are dangerous.

Michael Weir: Does the hon. Gentleman accept that in small ports it is a particular problem because there are no fisheries protection officers and fishermen have to give notice for officers to come from other ports, which makes it even more difficult for them to change nets and go out again to catch available stocks?

Alistair Carmichael: The nonsense of that situation is self-evident. It brings me to one of the specific concerns that I wish to raise on behalf of my constituents todaythe operation of the haddock permit system. The Minister has heard me before on this. Probably most hon. Members have heard more from me on this than they would ever want. I hope that this is the last occasion on which I have to speak about it.
	I simply do not understand how one starts with the proposition of a cod protection zone and ends up with a system that requires fishermen to obtain permits to fish outside that zone for haddock. How one dreams up a scheme like that, even with the assistance of mind-altering substances, is beyond me. It has led to severe operational hardship for fishermen in my constituency. It is bureaucratic and unworkable. We have been able to cope with it only because the system was lacking in detail when it was created in December last year and it was into 2004 that it became a working proposition. Simply to roll the system over into next year would be a disaster for the industry in the northern isles.
	The problem is that every time we come up with a system that is unworkable, we force fishermen into breaching it. That should be to no one's benefit. Any management system needs to be understandable and workable. Surely we should start out with a system whereby incentives can be given, for those who are able, not to catch cod. Surely that would be a much more sensible starting point.
	On the question of days at sea, I will not get into the game of guessing how many there should be, but I want to discuss the general parameters within which the Minister should operate. The number of days obviously has to be sufficient to keep ports viable; it has to be sufficient to allow boats to catch the quota and it has to take account of the extra steaming days that will be a necessity especially for boats in the northern isles, if the Minister has regard to the map that we had to work with last year, because boats are displaced from their normal grounds.
	I come back to the point raised by the hon. Member for Banff and Buchan (Mr. Salmond). Closed areas within the current framework of the CFP will be problematic because the policy operates on a year-to-year basis and does not have the flexibility that is required to make closed areas work. It may be necessary to open and close areas from month to month if not week to week. The hon. Member for North Shropshire (Mr. Paterson) spoke about the Conservatives closing some areas permanently. I would be very interested to hear exactly what areas would be closed permanently

Alex Salmond: Scotland.

Alistair Carmichael: That might be seen as vengeance, as Scotland nearly closed the Tory party permanently. I shall read the Conservatives' green paper with some care to see what the hon. Gentleman thinks would be achieved by such closures.

Owen Paterson: I said that we advocate having permanent closed areas and temporary closed areas. For example, off New England, there is one central closed area on St. George's bank, which has had huge success in rebuilding the yellow flounder stock, and there is also an area that is changed throughout the season as the cod move north. That has been enormously successful and the western gulf of Maine now yields some cod as large as 100 lb. We would leave it to local councils, exactly as the hon. Member for Hastings and Rye (Mr. Foster) suggested. It would not be me making the decisions, but the local councils.

Alistair Carmichael: We have had many fishermen pushed out of Orkney and Shetland, but I do not think that any of them have got as far as New England yet. I am interested in the hon. Gentleman's thinking on the issue. It is just the question of permanency that causes me some concern. I appreciate that some areas would be closed permanently and some temporarily and I do not dismiss the suggestion out of hand. I am pleased to hear that the hon. Gentleman has at last come round to the idea of greater local involvement, something that the Conservatives in government were notable for resisting.
	I wish now to revisit the hardy annual of the monkfish quota. We seem at last to have reached a stage where the Commission accepts that the science was not as robust as it might have beena euphemism almost as big as speaking of unintended consequences. I hope that we have the opportunity to get back to the 1999 level of quota for the UK. Given that it is unlikely that any further effort will take place, because of the reductions in the size of the fleet and the quota restrictions, this is a real opportunity for the viability of the fleet to be improved. I enjoin the Minister to resist any suggestion that any permit arrangements should be attached to any quota. I suggest that there will be a need to leave the area to the west outside the cod recovery zone and to open an area in the north North sea, as was done in 2003, to enable vessels to catch the improved quota.
	I also ask the Minister to strive for an improved quota for haddock in areas VIa and VIb, west of Scotland and Rockall. With regard to Rockall, it is essential that the European Unionperhaps the Minister could take a lead on thismeet the Russians and agree a quota that reflects the proper level of UK interest in that fishery. Otherwise, I very much fear that we will be squeezed out in that area as we were squeezed out of deep water fisheries a few years ago.
	As other hon. Members have mentioned, there is also the unfinished business of the nephrops quota, for which so much was promised and so little unfortunately delivered last year. The Minister goes to the Council with the good wishes of all of us on both sides of the House. The departure of Franz Fischler as the Commissioner presents an opportunity to improve our fisheries management and how we are dealt with. I hope that the Minister is able to seize that opportunity with both hands.

Lawrie Quinn: It is an honour to follow the hon. Member for Orkney and Shetland (Mr. Carmichael). Normally in these debates I resist the temptation to take up the full time allowed to me and I often give up one or two minutes to him, so I am pleased that he has been able to make a full contribution today. We are continuing in a good tradition, as the penultimate and ultimate speakers before the ministerial response.
	The hon. Gentleman is a great champion of his fishing community. I respect him for that, as do many people in my part of the fishing community. I associate myself wholly with his closing remarks and his best wishes to the Minister.
	I shall outline briefly three issues that I should like the Minister to consider in his work at the forthcoming ministerial Council, but first I want to associate myself with the comments of my hon. Friend the Member for Waveney (Mr. Blizzard) about fishermen's missions. I am sure that everyone in the House would want to pay tribute, too, to the work of the Royal National Lifeboat Institution, which is a solid part of the fishing community, many of whom belong to the RNLI and go out to help members of not only their local community but the wider maritime community. They do tremendous work on a voluntary basis.
	I want to single out my hon. Friend from down the coast, the Member for Great Grimsby (Mr. Mitchell), for his chairmanship of the all-party fisheries group, which is persuaded to do many things. Recently, we heard the Canadian Fisheries Minister and only this morning we received extremely good briefings from fishermen's organisations. Regrettably, however, we have never had the opportunity to listen to the hon. Member for North Shropshire (Mr. Paterson), so I hope that when the Conservative party publishes its green paperwith costs, we hopethe group can have a friendly, comradely dialogue with him, to follow the good work done by my hon. Friend the Minister and, in the past, by my hon. Friend the Member for Scunthorpe (Mr. Morley), now the Minister for the Environment and Agri-environment, to engage not only with us in a parliamentary sense but also with the key stakeholders who represent the community.
	Over the past year, my hon. Friend the Member for Great Grimsby has had a marked effect on the all-party group and has persuaded us to do many things to promote fish and the fishing industry. I do not know whether to say that I am glad or sad that a few months ago we were invited to enter a competition to display our culinary skills as part of a wonderful week for the promotion of sea fish. Regrettably, we came last, although my hon. Friend produced a remarkable concoction as a celebration of our right hon. Friend the Deputy Prime Minister.

Austin Mitchell: Coley  la Prescott.

Lawrie Quinn: Exactly. Unfortunately, the dish failed to attract anybody's attention.
	I pay tribute to my right hon. Friend the Deputy Prime Minister on the work that he has done for the Yorkshire and Humber region through the establishment of regional development agencies. I know that they do not find favour with the hon. Member for North Shropshire, but the RDA has undertaken some excellent work in my area to engage with the future of our Yorkshire coastal communities. If time allows, I might be able to inform the House and the Minister about that important work.
	If the Minister does not know about such work, perhaps he will undertake a review of the work that RDAs are doing on the coast of England to promote partnership and opportunities for fishing communities in terms of investment and improvements in training and marketing. That relates to the comments of my hon. Friend the Member for Hastings and Rye (Mr. Foster), who told us of the 4.5 million investment in a new fish quay in his constituency. Such work is taking place slowly but surely around England to bring investment for important parts of the fishing community. For example, in respect of shellfish, in Whitby in my constituency, we were able to go ahead with marketing the velvet crab. Mortality rates for the species are better and it is now a viable product, with a new market in that important part of the fishing community.
	My hon. Friend the Minister will be well aware that, in July, the EU was able to propose a new European fisheries fund, the EFF, which from 2007 will replace the current financial instrument for fisheries guidance, which runs until the end of 2006. I understand that the proposal will go before the Council of Ministers, which must adopt it for it to come into effect, following consultation with the European Parliament. I assume that that measure must be considered by the House, given the national parliamentary obligations. I hope that that will be the springboard by which the Minister, along with my right hon. Friend the Leader of the House, might consider formulating a debate that would allow all hon. Members a better attempt at scrutinising the decisions made at that European Council.
	It is my belief that the parliamentary scrutiny format represents a far better way for the representatives of fisheries communities from around the coast to achieve closer scrutiny. I am glad that the hon. Member for Banff and Buchan (Mr. Salmond) also remembered an occasion that may have been the first outingif that is not the wrong term to usefor the Fisheries Minister in the context of our debate. I hope that the Minister will consider bringing the outcomes for the EFF to the relevant Committee so that we can all engage in the debate and consider in detail the wider consequences of the work that he will do in Brussels in the very near future.
	I should like to return to a subject that is almost a tradition in such debates, and I am somewhat surprised that it does not seem to have had the type of airing that we would normally hear in the annual fisheries debate. I refer, of course, to industrial fisheries. As all hon. Members will know, the simple fact is that the Danish fleet dominates the sand eel fishery. I understand that, because of the poor state of the stock in 200304, the Danish fleet massively undershot its quota for this year and last year. In 2004, Denmark's quota for the North sea was 727,472 tonnes out of a TAC for EU member states, Norway and the Faroes of just over 800,000 tonnesa massive slice of the allowed quota. I understand that Denmark was able to catch only about 300,000 tonnes of that 700,000-plus tonne quota. Surely, given the debate that my hon. Friend will endeavour to have with his colleagues at the ministerial Council meeting, now is the time for us to deal with that issue and to ensure that the Danish quota is managed to an appropriate amount.

Alistair Carmichael: I am grateful to the hon. Gentleman for raising the subject of industrial fishingsomething that is having an impact on more than fish stocks. The seabird stocks around Shetland have been decimated this year, and there is no doubt in my mind at all that the blame lies at the door of the industrial fishery.

Lawrie Quinn: I am grateful to the hon. Gentleman for that contribution. Once again, he illustrates his knowledge of these issues. The hon. Member for Banff and Buchan referred to the fact that the marine environment is complex. I was coming to that issue, which links with the points made by the Minister in his opening remarks and, indeed, by my hon. Friend the Member for Hastings and Rye about the importance of tourism and other aspects of seaside life to the wider economy.
	Just down the coast from Scarborough and Whitby, there is an excellent puffin colony at Bempton cliffs. If we have a third season at Bempton that is as bad as the last two, the breeding productivity of kittiwakes will prompt strong demands, not only from naturalists and environmentalists, but from the fishing communities, for a closure, probably from somewhere off the east coast of Scotland down to Northumberland. It is a serious problem, which has an impact on the complicated marine environment and ecology.

Owen Paterson: An interesting Royal Society for the Protection of Birds study was recently published on the impact of such activity on sea bird populations. In addition, we need to recall that sand eels are a key food source for cod. Without getting too excited about our upcoming green paper, we will advocate drastic reductions in the practice of industrial fishing, even if not its elimination.

Lawrie Quinn: I am grateful to the hon. Gentleman for confirming that the Conservatives are seeing good sense on some issues.
	In the short term, however, I want to take the opportunity to wish my hon. Friend the Minister well from all fishing communities in Yorkshire and Humber. He has an important job to do. I am sure that he goes to the Council with the support of Labour Members and the bulk of the support of hon. Members in the Chamber.

Ben Bradshaw: With the leave of the House, I shall respond to the debate.
	One or two hon. Members asked whether it would be possible to meet me between the publication of the formal advice from the Commission next week and the Fisheries Council. I am happy to do that. Perhaps we will make informal arrangements, either after the debate or in ensuing days, to discuss the issues that they want to raise.
	I am glad that the hon. Member for North Shropshire (Mr. Paterson) is beginning to flesh out the Opposition's policy on fisheries. The Conservative party's green paper on fisheries will be one of its most hotly awaited policy documents for a long time. I look forward to seeing it.
	I do not want to dwell any longer than is necessary on the central plank of the Opposition's policy of withdrawal from the common fisheries policy, but I noted the recent comments by a former Conservative party chairman, Chris Patten, who in October said:
	If you decide to repatriate fish policy, are you going to depend on our fish being taught to swim only in our territorial waters? Is this the real world?
	I also noted an excellent article, which I commend to all hon. Members who have an interest in fisheries, by the right hon. Member for Skipton and Ripon (Mr. Curry), who, as I am sure hon. Members will remember, was the Fisheries Minister for four years under the previous Conservative Government. He speaks with great authority on the subject and recently wrote in the Yorkshire Post that he believes that the Tory policy is unwise and undeliverable. He went on to address, as the hon. Member for North Shropshire did not, some of the concerns raised by the hon. Member for St. Ives (Andrew George) and others about the possible cost of unilateral withdrawal. He asked the intriguing question of how much of the Royal Navy we are
	willing to deploy fighting a fisheries protection war against our European NATO allies.
	Those are good, important and interesting questions, which I am sure the hon. Member for North Shropshire will address in his much anticipated green paper.
	The hon. Gentleman raised a detailed problem, which he has mentioned to me before, about the situation in Fleetwood. My hon. Friend the Member for Blackpool, North and Fleetwood (Mrs. Humble) very much wanted to participate in the debate. It is the first time she has missed a fisheries debate, but she is hosting a Select Committee visit to her constituency today. She passed her concerns on to me.
	There has been some misunderstanding. There is always a problem in finding technical solutions to mixed fisheries. The vessel cited in The Daily Telegraph article and by the hon. Member for North Shropshire has, of 16 November, used 128 days this year, which is well within the 17 days a month allowed for vessels that use meshes of more than 100 mm. There is no reason why that vessel should not use 110 mm mesh rather than the 80 mm that it used when he was with it.
	The other aspect of the hon. Gentleman's contributionI also look forward to reading about this in more detailis that he is moving towards an effort control system as the best way of managing our fisheries, which is the Faroese system rather than the Icelandic system. I am particularly interested to know how a complete effort control system would work in the North sea, for example, and what impact it would have. I am sure that he and other Members realise that if we adopted the Faroese system in the North sea, it would mean a dramatic cut in effort and have pretty catastrophic impacts on fishing industries and boats in the constituencies of most of the Members present.
	As usual, my hon. Friend the Member for Great Grimsby (Mr. Mitchell) spoke with great authority and experience on this issue. I know that we disagree on some aspects of it, but I was pleased to hear that he described the publication of the Prime Minister's strategy unit report as a turning point. That is right; it shows a real commitment from the highest level to the future of the fishing industry.
	While my hon. Friend was speaking, I could not help thinking that, a few years backI think at a Labour party conferencehe changed his name by deed poll to Mr. Haddock. It is about since that date that we have seen a miraculous recovery in the haddock stocks. Perhaps I might suggest that he considers changing his name at the next Labour party conference to Mr. Cod. We will see what happens to the cod stocks. However, I take the points that he made seriously.
	My hon. Friend and a number of other Members were slightly unfair about Franz Fischler as a commissioner. He had a certain robust style, but it is not an easy business to chair an annual Fisheries Council meeting. His heart was certainly in the right place on the need for reform. He saw through reforms of the common fisheries policy against pretty fierce resistance from some member states. He shared our vision of a sustainable and profitable fisheries policy for the future. The new commissioner will have a different style, and we will work closely with him and, I hope, to the benefit of the UK industry.
	My hon. Friend the Member for Great Grimsby asked whether we could relax this year. Compared with some of the very difficult Councils that we have had in recent years, the background to this one is a little easier. I do not think that we can open the floodgates at this stage, but, as I said in my opening remarks, I think that we will be able to make progress on some stocks and that the fishing industry will welcome that. Although there are signs of cod recovery, it is from a very low base. However, I am determined to do what I can in those areas where the science justifies our taking action. I take on board my hon. Friend's concerns about the proposals for a cod protected area, the details of which I have not yet seen. The issue was also raised by several other Members.
	My hon. Friend requested greater certainty for the industry. We are trying to move towards that with the multi-annual approach that was adopted in the reform of the common fisheries policy. We certainly want to embed that, and it will be one of our priorities when we take over the presidency of the EU in the second half of next year.
	As usual, the hon. Member for St. Ives spoke with great authority, representing, as he does, Cornwall, which is one of the main fishing areas in England. He expressed frustration with the annual timetable of the whole process, and I share that frustration. I discussed the issue with Commissioner Borg at our meeting, and I think that it is a frustration he shares. If parties here and the industry would like to push for changes to the timetable, I think that we are pushing at an open door with the new commissioner. I shall certainly take that issue on board.
	I acknowledge that we disagree with some of the recommendations that we expect to be made by the Commission. They include the recommendations on western channel sole. The hon. Gentleman is right to suggest that the United Kingdom has been working very closely not just at official level but through representatives of the industry to come up with an alternative plan for western channel sole. We hope to make further progress on regional advisory councils during our EU presidency and will continue to push for that.
	The hon. Gentleman mentioned the Bradley report. There has been a certain amount of misreporting and Chinese whispers in what I may or may not have said about how we intend to implement the recommendations in the Bradley report. I reassure the hon. Gentleman that we have not made any decisions yet. I recognise the important work that sea fisheries committees do, and everyone agrees that we need to modernise the way in which we manage and enforce our inland fisheries. Whatever system we adopt, I want to try to retain the local expertise and democratic accountability that the sea fisheries committees bring with them.
	The hon. Gentleman should not be too disappointed that a marine Bill was not in the Queen's Speech. There was never any realistic prospect that it would be in this Queen's Speech, but the fact that the Prime Minister is explicitly committed to a Bill as soon as the legislative programme allows is a good sign. I and my colleagues in DEFRA will work to make sure that it happens as quickly as possible.
	The hon. Member for South Down (Mr. McGrady) has apologised for the fact that he cannot be here because he has to take a plane back to his constituency, but he made a number of points that I promise to take up and bear in mind. He gave me some good advice about negotiating tactics that might benefit his fishermen in Northern Ireland. He made an interesting point about climate change, as did others, and the role that it might play in changing the habits of fish stocks. There is certainly evidence that, with global warming and changing sea temperatures, stocks are moving around. Stocks that were formerly further south in UK waters are moving up, and cod seems to be moving north. However, we must be careful about using climate change as an excuse to avoid addressing the problem of over-fishing. We must take all the factors that affect fish stocks into account if we are to have a successful and sustainable fisheries policy.
	I congratulate the hon. Member for Banff and Buchan (Mr. Salmond), as this is the first time that we have faced each other in the Chamber since he resumed the leadership of his party. I shall, of course, keep him informed. In fact, for the first time this year, we have allocated a senior DEFRA official to keep the fishermen informed during the Council. It is difficult for me as the Minister to do so or, indeed, for Mr. Finnie, because we are trapped in the building. We never know when the commissioner is going to burst into the room and ask for a bilateral, or when a Minister representing another country will want to hold one. We cannot leave the building, and the fishermen cannot come to see us, but we shall certainly keep in as close contact as possible. Personally, I intend to meet industry representatives during the Council if possible.
	It was slightly unfair of the hon. Gentleman to say that Governments have not given priority to the fishing industry. I hope that he acknowledges that the strategy unit report was a major sign that the Prime Minister was worried about what was happening two years ago at the Council, and wanted to get to grips with the problem for the medium and long-term future. I agree that there is a case for fighting for an increased TAC on prawns, and I agree with the hon. Gentleman about haddock. On monkfish, he will probably be aware that a joint industry-science project has helped to secure improved data, and we will argue for a substantial increase in the Council negotiations in December.

Alex Salmond: Will the Minister give way?

Ben Bradshaw: I am terribly sorry. I have four minutes left, and if I do not rattle on I will not be able to respond to all the comments made by hon. Members.
	My hon. Friend the Member for Waveney (Mr. Blizzard) made a good point about long-lining, which I shall certainly take on board, as there is enormous potential for a more sustainable fishery. I shall also look into his comments about CEFAS, which does a terrific job. Talks to try to resolve the problems that he raised are imminent, and I shall shortly meet the new director of CEFAS, when I shall certainly reiterate the points that he made. The hon. Member for Argyll and Bute (Mr. Reid) made some good points about the cost of leaving the CFP, and I agree with him about west of Scotland prawns. The issue has been raised with me a number of times by my hon. Friend the Member for Western Isles (Mr. MacDonald), and we certainly intend to pursue it as a priority in the Council negotiations. I also accept the point made by the hon. Member for Argyll and Bute about annexe V and the difficulties that it has caused his fishermen.
	I consulted the Shetland fisheries representative, Hansen Black, at the Council meeting in Brussels last month. I accept what the hon. Member for Orkney and Shetland (Mr. Carmichael) said about haddock permit problems, and am pleased that he welcomes the progress on regional advisory councils. As I have said, we will make further progress on that. I made clear to the new Commissioner the importance of listening to the RACs, as it would be politically fatal not to do so just as they are becoming established. I believe that that is a good argument to use in the negotiations.
	I accept the point about the new funding system made by my hon. Friend the Member for Scarborough and Whitby (Lawrie Quinn). I am always keen to have debates on fisheries, but the decision is not just up to me; other people, such as business managers, are involved. My hon. Friend is right about industrial fisheries, and he will be pleased that, given their condition, there are likely to be recommendations for severe cuts. It has always been the UK position to support such a proposal.
	Finally, my hon. Friend the Member for Hastings and Rye (Mr. Foster) said that I had brought him some pre-Christmas cheer. It is always good to be able to do so, but I do not think that I have ever been described as a fishermen's friend before. However, I will accept compliments wherever they come from. I am rather disappointed that he did not invite me to open his new quay, but perhaps there is still time. As for what he may want in his Christmas stocking next year, I understand that my officials are talking to his fishermen tomorrow about that very issue.

Tom Watson: I beg to ask leave to withdraw the motion.
	Motion, by leave, withdrawn.

WESTMINSTER HALL

Ordered,
	That, on Tuesday 21st December, there shall be no sitting in Westminster Hall.[Mr. Watson.]

ADJOURNMENT (CHRISTMAS)

Motion made, and Question put forthwith, pursuant to Standing Order No. 25, (Periodic adjournments),
	That this House, at its rising on Tuesday 21st December, do adjourn till Monday 10th January 2005.[Mr. Watson.]
	Question agreed to.

PROGRAMME MOTIONS

Ordered,
	That Standing Order No. 83A (Programme motions) be amended, as follows:
	(1) in paragraph (6) leave out 'three' and insert 'four';
	(2) in paragraph (8) leave out 'a resolution of a programming committee under paragraph (5) of Standing Order No. 83B (Programming committees) or'; and
	(3) after paragraph (9) insert:
	'(9A) The fourth exception is where the motion relates to a resolution of a programming committee.'.[Mr. Watson.]

INCOME TAX (TRADING AND OTHER INCOME) BILL

Ordered,
	That the Income Tax (Trading and Other Income) Bill be proceeded with as a tax law rewrite Bill.[Mr. Watson.]

HEALTH SERVICES (MAIDSTONE)

Motion made, and Question proposed, That this House do now adjourn.[Mr. Watson.]

Ann Widdecombe: I am grateful for securing the Adjournment debate tonight. It concerns a matter of vital importance to my constituents. I am delighted to see in the Chamber my hon. Friend the Member for Faversham and Mid-Kent (Hugh Robertson), whose constituents will also be profoundly adversely affected by the proposed changes to hospital services in Maidstone.
	Let me set the scene. Maidstone is a large general hospital that was built under the Conservative Administration in 1983. It was modern and covered a wide range of services. Since that time, the oncology services have been vastly expanded and the hospital is now recognised as a centre of excellence for oncology in the south-east. Until a few years ago, the picture was a fairly happy one, but since 2000 there has been a consistent stream of proposals toI can put it in no other termsplunder Maidstone.
	Over the past two years, we have been raided. We have already lost, in a fairly stealthy way, almost without anybody noticing, our chronic pain unit, which has charged down the road to Pembury. That leaves citizens of Maidstone, who were used to having pain services available, with pain services available only by means of a four-hour round trip on the No. 6 bus. It is scarcely an ideal situation for people without private transport.
	Earlier this year, a proposal that had been made in 2000 and rejected was raised again. It would mean our losing the most important chunk of our accident and emergency services to Tunbridge Wells. In addition, there is a proposal that we would lose a major part of our obstetrics services, again to Tunbridge Wells.
	The Government decided to merge trusts. It is impossible to imagine that when Maidstone was its own trust, it would have volunteered to lose services and suggested that they wander off 17 miles awaythat is the shortest possible distance. But because the trusts of Tunbridge Wells and Maidstone have been merged into one large trust, there is no unique voice, other than mine and that of my hon. Friend, speaking up specifically for Maidstone.
	If there were unavoidable strategic reasons for the changes, I might admit that there was some force to the argument for bringing them about, but close examination suggests that that is not the case. One of the reasons why that has been advanced is that the changes all stem from the European working time directive, which means that junior doctors cannot work the hours that they used to. We therefore have to recruit more junior doctors, and when that proves impossible, we have to merge services, so that where there were two services before, we shall have only one.
	We have also been told that the consultants involved approve the changes. I shall quote from a letter from Mr. Christopher Walker, a consultant orthopaedic surgeon who worked at Maidstone hospital from its opening in 1983 until August 2002, and still does occasional clinical work. He says this of the proposal to take trauma services to Tunbridge Wells:
	Most importantly, the road access to the Kent and Sussex Hospital is poor when compared to that of the Maidstone Hospital. Maidstone is well placed to receive trauma rapidly having both good access to the motorways and a helipad. Indeed, in my time at Maidstone I received a badly injured motorcyclist who had been involved in a road traffic accident about one mile from the Kent and Sussex Hospital, as it was quicker to transfer him to Maidstone AE . . . than to get a traditional road ambulance to take him at peak time to the Kent and Sussex AE.
	He goes on to say:
	If Trauma Services are moved to Tunbridge Wells, Maidstone patients will need to access another AE. The Kent and Sussex would be very difficult for them to reach.
	He says that they would be more likely to go to the Medway accident and emergency department, which is already under massive pressure.
	Mr. Walker identifies as a further effect of the proposed move
	a downsizing of emergency services in general and a move of staff and facilities from Maidstone to Tunbridge Wells.
	He says:
	Trauma Services cannot be managed successfully by Orthopaedic  Trauma Surgeons in isolation. Support is essential from other specialities especially General Surgery, Vascular Surgery, Anaesthetics, General Medicine and Paediatrics. Presumably adequate support could only be given by transferring support in these specialities from Maidstone to Tunbridge Wells.
	As a consultant surgeon, he takes the following view:
	I believe this would have the effect of reducing Maidstone AE to a minor injuries unit, as well as reducing the Consultant and Junior Staff numbers at Maidstone, so further disadvantaging the local population.
	Mr. Walker is not alone in taking that view. Another consultantthis time a consultant physician currently practising at Maidstone hospital, where he is also a clinical tutorcontends that the proposals will have a serious effect not only on trauma services, but on training. He makes this point:
	The Acute Services Review of 2000 concluded that trauma services should remain at both Maidstone and Tunbridge Wells. It is the proposal to change this conclusion at this stage that has caused considerable disquiet.
	He says that
	the proposal to downgrade the trauma service . . . will impair access to appropriate care for patients from the Maidstone area who sustain a fracture; and . . . it will adversely affect Maidstone hospital as a general hospital and training institution . . . Removing trauma services from Maidstone matters for the hospital as a whole principally because it will reduce the capability of the AE department.
	He goes on to say:
	The Senior House Officer posts in AE are accredited for training by the Royal College of Surgeons. It is uncertain if that accreditation would remain . . . if no major trauma came to the department . . . A hospital unable to offer the full range of experience will have difficulty in recruiting the best trainees, particularly those whose career plans might include surgery or critical care.
	He adds:
	A hospital lacking a full AE department would struggle to be taken seriously as an acute general hospital.
	I fully understand that point, even from a layman's point of view; the hospital would not be taken seriously as an acute general hospital, and it would find it very difficult to recruit and retain consultants in acute specialities, particularly general medicine and critical care.
	Perceptively, that consultant goes on to say:
	The real problem with the current discussion is that it puts the cart before the horse. We are discussing individual services without any clear vision for the future of the hospital as a whole. There is a clear vision for cancer services in Maidstone, and there is a comprehensive vision for the new hospital in Pembury
	for which I am grateful
	but for non-cancer general hospital services in Maidstone, however
	he puts this politely
	the future is more opaque.
	The future of Maidstone general hospital is a major question. Will it remain as a serious general hospital or will all its major general facilities be moved gradually and piecemeal to Tunbridge Wells, while Maidstone is promoted as Kent's answer to the Royal Marsden hospital? Is that the future that is envisaged? If it is, why do the Government, the trust and the SHA not come clean and let us know? It would cause my constituents massive disquiet.
	For maternity services, consultants have stated that the European working time directive is not causing problems in obstetrics, but that difficulties will be created in recruiting serious consultants and doctors to a unit as small as the one proposed for Maidstone. Confronted with that massive reduction, the general expectation is that mothers will choose other hospitals. At the moment, 25 per cent. of mothers transfer from the birthing centre to the labour ward with difficulties. If the labour ward is 17 miles away, consultants claim that brain damage could be caused to babies.
	I have also mentioned the loss, which we have already sustainedalmost without anybody noticingof the chronic pain unit. It was moved in September 2004 from Maidstone to Pembury. The first that the patients knew about it was a letter a couple of months earlier. Openness appears to have given way to at best opacity, and at worst secrecy. What is the future, and what is the vision for Maidstone as a general hospital?
	Earlier, I said that it had been claimed that the consultants accepted the necessity for that disquieting decision. In fact, however, 50 senior clinicians have signed a letter to Rose Gibb, the chief executive of the trust. This is not a politician speaking; these are clinicians who say:
	We believe the proposed cuts at the Maidstone hospital to be dangerous, ill-advised and unnecessary. They will place acutely ill patients, particularly the elderly and children, at additional risk of morbidity and death by transferring them to an inaccessible and less suitable site. The loss of this acute service will result in the inevitable haemorrhage of essential skilled staff. We feel the knock-on effect on the remaining acute services will lead to their progressive erosion, reducing Maidstone to an elective hospital only.
	Among the consultants who signed that statement are those in general surgery, anaesthetics and critical care, cardiology, medicine, neurology, ophthalmics, oncology, paediatrics and, of course, obstetrics and gynaecology. That is the view of those on the ground who actually have to deliver the service.
	When I fully recognised the problems and their scale, I wrote to the Secretary of State for Health, who replied promptly but unhelpfully. Essentially, he told me what I already knewthat there was a consultation exercise. Yes, I had got that far. He then told me that there were proposals to reconfigure servicesI had certainly got that farand that it was a matter for the trust. This goes beyond just being a matter for the trust. There is, I believe, a serious crisis of confidence in Maidstone about the future of a large and well-respected general hospital.
	On behalf of my constituents who live at the other end of the constituency, I am of course delighted that at last, after too many years, we are getting a brand-new hospital. I would not want any of the comments that I have made today to be taken to mean otherwise. However, the original plan was that essential services such as trauma and obstetrics should be available in both centres, not that there would be a share-out of some sort, as of eggs in a basket.
	My first question for the Ministerwho has, I am sure, been in contact with the trustis this: what is the future for Maidstone? Will it remain a general hospital? If so, will it be taken seriously as a general hospital, given the changes that are mooted? Or will it simply become an elective surgery and cancer specialty? Secondly, as so many consultants are so worried, how can the administrators of the trust decide that this is the right way forward?
	Thirdly, may we have an absolute undertaking that, if services such as the chronic pain unit are to be moved in future, there will be a proper and full consultation? Interestingly, when one of my constituents rang the local press, the people there did not know anything about that particular movebut they certainly know about the trauma services, and they are making a fuss.
	Although in such circumstances there is always a fine line to be walked, between alerting one's constituents and alarming them, I myself have become alarmed by the proposals. I believe that they should be abandoned, and that the original decision taken in 2000 to retain services in both hospitals should be maintained.

Melanie Johnson: I congratulate the right hon. Member for Maidstone and the Weald (Miss Widdecombe) on securing this debate on the proposed transfer of services from Maidstone hospital to Tunbridge Wells. Before I turn to the specific issues that she raised, I should like to take this opportunity to recognise the work across the whole of Kent in delivering good-quality services and to pay tribute to all the staff who are dedicated to that process. I am sure that she would join me in that.
	All Members rightly attach the highest importance to developments in the NHS in their constituencies. It is important that local people are able to have local access to high-quality health services for users of orthopaedic and maternity services, as well as several other services that the right hon. Lady mentioned. As she knows, our policy is one of devolution to give local communities a real opportunity to plan and to develop health services according to their needs and demands. We have backed that up with significant additional funding. Over 200304 to 200708, expenditure on the NHS in England will increase on average by more than 7 per cent. a year over and above inflationan increase of 34 billion.
	The majority of that funding has been made direct to primary care trusts. In that way, we are putting resources in the hands of front-line NHS staff alongside their responsibilities for developing and running services. In the right hon. Lady's constituency, Maidstone Weald PCT will receive an increase in its revenue allocation of 36.4 million between 200304 and 20056. That represents a cash increase of 28.7 per cent.
	The right hon. Lady raised several concerns, some of which touched on the proposed transfer of women's and children's services from Maidstone to Tunbridge Wells. I stress that those remain proposals and that no firm decision has been made.
	The right hon. Lady concentrated most of her remarks on the trauma services and linked orthopaedic services. I can give her assurances on some of the matters on which she seeks them. I understand that she is a local Member concerned about what is happening in her patch. She graphically expressed her anxiety about the matter, and I understand that, but she need not worry about a unique voice, because many of us would say that she is a unique voice. I am sure that she is a unique voice on behalf of her constituency.
	The joint Maidstone and Tunbridge trust has stressed throughout the discussions that the area and the people that it serves will always need two acute district hospitals. I emphasise the word acute because the right hon. Lady is worried that one will become totally elective. That is not the trust's intention: there will be one hospital in Maidstone and another in Tunbridge Wells, and they will work together in a complementary way. I understand that that can sometimes cause anxieties, and I am familiar with the situation from elsewhere, not least my constituency.

Ann Widdecombe: I accept that there will continue to be an accident and emergency unit at Maidstone, but the consultants' point is that it will be greatly reduced. All the orthopaedic trauma will go to Tunbridge Wells and the consultants point out that that cannot be done in isolation. Others will follow, and in the end, the unit will be so small that it will not deserve to be considered in the same way as a big general acute unit.

Melanie Johnson: I appreciate the right hon. Lady's view, but both hospitals will continue to provide the bulk of acute surgical, medical, emergency and life-saving care for patients and each will need accident and emergency departments capable of dealing with minor and major illnesses and injuries. I am told that the strategic health authority has categorically stated that Maidstone hospital's accident and emergency department is not closing down or being run down.
	I appreciate that issues such as training hospital consultants and doctors, and accreditation by the royal colleges need to be sorted out. That needs to be done locally to ensure that the mix of cases that goes to both hospitals is capable of sustaining the right accreditation by the royal collegesfor example, for accident and emergency accreditation purposes. I understand that the chief executive has met the majority of the consultants individually or collectively.
	We do not deny that some concerns have been expressed. They have centred around the misconception that all the surgical services would be transferred to the Kent and Sussex hospital. Some consultants were also worried that there might be pressure on them to express certain views. Notwithstanding that, some have genuine concerns about the future. We accept that concerns have been expressed, but I assure the right hon. Lady that the strategic health authority is committed to two full accident and emergency departments in the two district general hospitals and sustaining the mix of services.
	The right hon. Lady mentioned the transfer of the chronic pain clinic. I am not familiar with as much of the detail as I suspect she is. I understand that some 600,000 of additional resources have gone into the clinic at Pembury hospital, to which it is to be transferred. Extra investment has gone into that pain unit, and I am sure that that creates an improved service. We accept that we need two accident and emergency units and two district hospitals. The question is about the division of some of those areas of specialty, which can be provided principally in one or another of the hospitals.
	In the past few years, Maidstone hospital has had major investment in its eye, ear and mouth unit. There has been some 11.9 million of investment. The hospital has received 2.8 million for a new breast care centre; 2.2 million for a new emergency care centre; and 1.7 million for the orthopaedic unit. In Tunbridge Wells, the Pembury hospital and the Kent and Sussex hospital have received 3.5 million investment in more doctors; the chronic pain unit that I mentioned; some refurbishment of the maternity unit; and 1.15 million for a new MRI scanner. That shows that there has been a division of resources between the two sites.
	The right hon. Lady talked about the pressure on junior doctor hours as a result of the working time directive, but there is a wider rationale. That rationale includes the following considerations: to improve the quality of services for patients; to reduce the number of cancelled operations, as currently one in five elective procedures are cancelled in Maidstone and Tunbridge Wells, which the trust and the strategic health authority are looking to improve on; to reduce the risk of infection by segregating all orthopaedic patients from surgical patients, which is highly important; and the development of on-call rotas that offer consistency of care. Among all the other factors are the fulfilment of the requirement to meet junior doctors' working hours under the European working time directive, and gaining efficiencies of full day-care elective theatre lists to reduce waiting times for patients. The provision of centres of excellence for patients that offer and are able to meet national standards of care and to attract highly skilled staff is also important. Making the best use of the consultant work force, with sub-specialisation, is also a factor.
	The benefits for patients that the trust and strategic health authority are looking for are: ensuring that booked operations are not cancelled; reducing waiting time for operations; reducing the risk of infection following surgery; delivering rapid assessment, out-patient, diagnostic and day-case services at both hospitals; and ensuring that professional standards are consistently met. That shows that a rationale exists that makes clear the reasons for this discussion.
	Currently, we have only a proposal before us, and I realise that, sadly, the right hon. Lady did not appreciate my right hon. Friend the Secretary of State's letter. I gathered that. He was being very fair in what he wrote to her, however, as he was pointing out that this matter was still up for discussion, and that the details need to be thrashed out. I understand that such discussions raise a lot of local anxieties, and I sympathise with local MPs and local people concerned about them. I have set out a number of powerful and important reasons why it is necessary to examine these issues, including the benefits that can be gained for patients from improvement of patient care.
	I want to touch briefly on maternity services, because I want to assure the right hon. Lady that we are committed to good-quality, women-centred maternity care. We have a commitment to improving maternity services by modernising maternity units, increasing the number of midwives and giving women greater choice in childbirth. There have been huge advances. It is now much safer to give birth, and women are now actively involved in making decisions about the maternity care that they want to receive. As I am sure she is aware, we published a national service framework on 15 September, and under the standard, NHS maternity care providers and primary care trusts are required to ensure that the range of antenatal, birth and post-birth care services available constitutes a real local choice for women, including home births and midwife-led care, and midwife-led units in the community or on a hospital site.
	Additional funding has been made available for refurbishments, including of hospitals in Kent, to improve the environment. I hope that the right hon. Lady will agree that we all recognise that hospital services need to change if we are to continue to fulfil patients' needs and improve access. Services cannot remain static. They must be responsive to local needs and changing patterns, higher standards and the different services that can be provided as modern medicine advances. That is what we are seeking to achieve through the changes that are being implemented.
	The matter in hand is still a discussion on a proposal, and I trust that the right hon. Lady will be able

Ann Widdecombe: Very quickly, does the Minister therefore envisage a possibility that these things will not happen?

Melanie Johnson: I cannot envisage anything. I was blessed with neither a cup of tea leaves nor a crystal ball. The dialogue must continue, however, so that all the parties are reassured about what the outcomes are. There cannot be a huge difference
	The motion having been made after Six o'clock, and the debate having continued for half an hour, Mr. Deputy Speaker adjourned the House without Question put, pursuant to the Standing Order.
	Adjourned at ten minutes to Seven o'clock.